APR calculator
Money & financeHow much does your loan really cost per year?
Turn the interest rate and the fees of a loan into one annual percentage rate (APR) by the EU formula.
What you enter stays on your device while you use this tool. Opening a shared link sends the settings in its address to HowToolbox to prepare the page.
Annual percentage rate (APR)
13.3%
The credit costs €1,003.95: €723.95 in interest and €280.00 in fees.
By the EU consumer credit formula: the rate at which the payments and fees, discounted to the payout, equal the credit. Shown to one decimal, rounded half up.
An estimate for comparing offers, not a credit offer. The lender's standard information gives the binding APR; it may include costs not entered here.
Total cost
- Total interest €723.95 · 72%
- Fees €280.00 · 28%
= Total cost €1,003.95
From interest rate to APR
| Item | Value |
|---|---|
| Nominal interest rate | 9% |
| Effective rate of the interest alone | 9.4% |
| APR with fees | 13.3% |
| Monthly payment with fees | €164.00 |
| Total paid | €6,003.95 |
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Turn the interest rate and the fees of a loan into one annual percentage rate (APR) by the EU formula.
How to use
- Enter the credit amount, the nominal interest rate and the number of monthly instalments.
- Add the one-off fee charged at the start and any fee charged with every instalment.
- Read the APR and the total cost, and compare it with other offers' APRs.
How it works
The interest rate tells only part of what a loan costs: fees add to it, and so does interest compounding month by month. The annual percentage rate of charge (APR) puts everything into one yearly rate, so offers with different rates and fees can be compared.
The APR is the rate X at which the money you receive equals everything you pay, each discounted to the payout: Σ C (1 + X)^−t = Σ D (1 + X)^−s, where C is the credit paid out, D each instalment and fee, and t and s their times in years.
This is the formula of the EU Consumer Credit Directive (Annex III of Directive 2023/2225, as in the earlier Directive 2008/48/EC), which Finland applies by Ministry of Justice decree 1123/2016. A month is a twelfth of a year, and the result is given to one decimal.
The calculation assumes a fixed rate, equal instalments and the fees entered here. A lender must include every compulsory cost, such as required insurance, so its stated APR is the binding one.
Worked example
What is the APR on €1,000.00 at 12% over 12 months without fees?
- r = 12 ÷ 100 ÷ 12 = 0.01.
- (1 + r)¹² − 1 = 12.7%.
12.7%
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Frequently asked questions
Why is the APR higher than the interest rate?
Monthly interest compounds over the year, and fees are part of the cost. Even without fees, 12 % a year charged monthly is 12.7 % a year.
Why do short loans with a fee have such a high APR?
A fixed fee over a few months is a large cost for a short time, and the APR expresses it per year. That is why small, short loans often show APRs in the tens or hundreds of per cent.
Should I compare the APR or the total cost?
Both. The APR compares offers of different lengths and fees fairly; the total cost tells how much the loan costs you in money.
Can I include an upfront fee?
Yes. Enter it as the setup fee, separate from the monthly fee. It reduces the money available at the start.
Does this handle irregular payment dates?
No. Payments are one equal month apart, with the first payment one month after the loan starts.
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