Interactive APR (Annual Percentage Rate) Calculator

The APR is the actual yearly interest rate paid by a borrower, figuring in the points charged to initiate the loan and other costs.

Calculate actual interest rate you are paying due to additional cost of loan
Principal * ($)
Amount of money borrowed
Additional Cost ($)
Processing fee, bond fee etc
Interest Rate * (%)
Percentage of interest paid annually on principal
No of Months *
No. of months over which you will repay this loan


Here is a short example of how to calculate the APR and see how it differs from normal interest rates:
Loan Amount (P) = $100
Additional Cost (E) = $5
Interest Rate (I) = 12%
Monthly Interest Rate (r) = R/100*12=0.01
Number of month (n) = 1

Now, applying Newton-Raphson Method, we get an APR (A) =0.0605*1200=72.60%

From the above calculation, we see that for a loan amount of $100 with 12% interest, the APR can be as high as 72.60%, depending upon the extra costs and the time taken for repayment.


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