APR Calculator

Understanding APR (Annual Percentage Rate)

The Annual Percentage Rate (APR) represents the true cost of borrowing. Unlike the interest rate, APR includes upfront fees and other charges you pay to get the loan.

How APR Differs from Interest Rate

• Interest Rate: The cost you pay each year to borrow the money, expressed as a percentage. It does not include fees.
• True APR: Includes both the interest rate and any additional costs such as origination fees, closing costs, or mortgage insurance.

Comparing APRs is the best way to compare the total cost of different loan offers. A loan with a lower interest rate but higher fees might actually have a higher APR.