Actual Loan APR Calculator

Calculate the Real Annual Percentage Rate (APR) of a loan.

Many lenders advertise a low "monthly flat rate" (e.g., 0.5%), but since you repay part of the principal every month, you don't actually hold the full loan amount for the entire term. This makes the effective interest rate much higher than the nominal rate.

One-time fees (processing fees, insurance) further increase the real cost of borrowing.

Many loans advertise low monthly rates (e.g. 0.5%), but because you repay principal monthly, the actual interest rate is much higher. Use this tool to see the truth.

Loan Settings

Loan Amount

Term (Months)

Rate Type

Monthly Rate (%)

One-time Fees

Analysis Result

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How it works

This tool uses the Internal Rate of Return (IRR) method to calculate the effective APR. It considers:

1. Cash Inflow: The actual amount you receive (Loan Amount - Fees).
2. Cash Outflow: Your monthly repayments.
3. Time Value: Money paid today is worth more than money paid tomorrow.

Common Pitfalls

• Flat Rate: Interest is calculated on the original principal, not the remaining balance. A 0.5% monthly flat rate is roughly equal to an 11% APR, not 6%.
• Upfront Fees: Any fee deducted from the loan amount significantly spikes the APR, especially for short-term loans.