APR Comparison Calculator: Find Your Best Deal
Compare multiple loan or credit card offers to find the best deal.
How This APR Comparison Calculator Works
Our APR comparison calculator helps you evaluate multiple loan or credit card offers side-by-side. Compare:
- True APR – Including all fees and costs
- Monthly payments – What you’ll pay each month
- Total interest – Lifetime interest cost
- Total cost – Principal + interest + fees
- Cost per $1,000 borrowed – Easy comparison metric
Stop guessing which offer is best. See the math and choose confidently.
Understanding APR
What Is APR✓
APR (Annual Percentage Rate) is the yearly cost of borrowing, expressed as a percentage. It includes:
- Interest rate – Base borrowing cost
- Fees – Origination, closing costs, points
- Compounding – How often interest is calculated
APR is designed to help you compare offers apples-to-apples.
APR vs. Interest Rate
| Term | What It Includes | Best For |
|---|---|---|
| Interest Rate | Only the base rate | Understanding base cost |
| APR | Rate + fees + costs | Comparing offers |
Example: – Loan A: 6.0% interest rate, 1% origination fee → 6.4% APR – Loan B: 6.25% interest rate, no fees → 6.25% APR
Loan B is cheaper despite higher interest rate (lower APR).
Types of APR
| APR Type | Description | Watch For |
|---|---|---|
| Fixed APR | Stays the same | Rate lock expiration |
| Variable APR | Changes with market | How high it can go |
| Introductory APR | Temporary low rate | What rate becomes after |
| Penalty APR | Triggered by late payment | How it’s applied |
| Purchase APR | For new purchases | Differs from other APRs |
| Balance Transfer APR | For transferred balances | Transfer fees |
| Cash Advance APR | For cash withdrawals | Usually highest |
APR Comparison Examples: Finding the Best Deal
Example 1: Comparing Personal Loan Offers ($15,000)
Scenario: Marcus receives three loan offers for debt consolidation.
The Offers:
| Lender | Interest Rate | Origination Fee | APR | Term |
|---|---|---|---|---|
| Bank A | 9.99% | 0% | 9.99% | 48 mo |
| Bank B | 8.49% | 3% ($450) | 9.75% | 48 mo |
| Bank C | 10.99% | 0% | 10.99% | 48 mo |
Total Cost Comparison:
| Lender | Monthly Payment | Total Interest | Total Fees | Total Cost |
|---|---|---|---|---|
| Bank A | $380 | $3,241 | $0 | $18,241 |
| Bank B | $371 | $2,750 | $450 | $18,200 |
| Bank C | $389 | $3,675 | $0 | $18,675 |
Winner: Bank B – Despite the fee, lowest total cost by $41.
Key Insight: Don’t dismiss loans with origination fees automatically. The lower rate can offset the fee.
Example 2: Credit Card Balance Transfer Offers ($10,000)
Scenario: Sarah wants to transfer $10,000 to pay off faster.
The Offers:
| Card | Intro APR | Intro Period | Transfer Fee | Regular APR |
|---|---|---|---|---|
| Card A | 0% | 18 months | 3% ($300) | 21.99% |
| Card B | 0% | 21 months | 5% ($500) | 19.99% |
| Card C | 2.99% | 24 months | 0% | 24.99% |
If Paid Off During Intro Period:
| Card | Transfer Fee | Interest (Intro) | Total Cost |
|---|---|---|---|
| Card A | $300 | $0 | $10,300 |
| Card B | $500 | $0 | $10,500 |
| Card C | $0 | $612 | $10,612 |
Winner (18 months or less): Card A – Lowest total cost if paid off in time.
If NOT Paid Off During Intro (paying $400/month):
| Card | Remaining After Intro | Post-Intro Interest | Total Cost |
|---|---|---|---|
| Card A | $2,800 (18 mo) | $893 | $11,193 |
| Card B | $1,100 (21 mo) | $247 | $10,747 |
| Card C | $400 (24 mo) | $52 | $10,664 |
Winner (longer payoff): Card C – No transfer fee + lower remaining balance.
Lesson: The best card depends on your payoff timeline.
Example 3: Auto Loan Offers ($28,000)
Scenario: Jennifer is buying a new car and has three financing options.
The Offers:
| Lender | APR | Term | Monthly Payment | Total Interest |
|---|---|---|---|---|
| Dealer | 6.9% | 60 mo | $554 | $5,221 |
| Credit Union | 5.4% | 60 mo | $533 | $3,983 |
| Bank | 5.9% | 72 mo | $463 | $5,369 |
Full Comparison:
| Lender | Monthly | Total Payments | Total Interest | True Cost |
|---|---|---|---|---|
| Dealer | $554 | $33,221 | $5,221 | $33,221 |
| Credit Union | $533 | $31,983 | $3,983 | $31,983 |
| Bank | $463 | $33,369 | $5,369 | $33,369 |
Winner: Credit Union – Saves $1,238 vs dealer, $1,386 vs bank.
The Bank Trap: Lower monthly payment ($463 vs $533) but higher total cost. The 72-month term costs more overall.
Example 4: Mortgage Offers ($350,000)
Scenario: The Andersons are comparing mortgage offers for their home purchase.
The Offers:
| Lender | Rate | Points | Closing Costs | APR |
|---|---|---|---|---|
| Lender A | 6.25% | 0 | $8,000 | 6.41% |
| Lender B | 6.00% | 1 ($3,500) | $8,500 | 6.29% |
| Lender C | 6.50% | 0 | $5,000 | 6.57% |
30-Year Cost Comparison:
| Lender | Monthly P&I | Total Interest | Total Closing | Total Cost |
|---|---|---|---|---|
| Lender A | $2,155 | $426,048 | $8,000 | $784,048 |
| Lender B | $2,098 | $405,440 | $12,000 | $767,440 |
| Lender C | $2,212 | $446,534 | $5,000 | $801,534 |
Winner: Lender B – Despite paying points, lowest total cost by $16,608.
Break-Even on Points: – Extra upfront: $4,000 (points + higher closing) – Monthly savings: $57 vs Lender A – Break-even: 70 months (5.8 years)
If staying 10+ years: Lender B wins If moving in 3-5 years: Lender A might be better
Example 5: Student Loan Refinancing ($55,000)
Scenario: David compares refinancing offers for his student loans.
Current Loan: 6.8% average, $633/month, 10 years remaining
Refinance Offers:
| Lender | APR | Term | Monthly | Total Interest |
|---|---|---|---|---|
| Current | 6.8% | 10 yr | $633 | $20,960 |
| Lender A | 5.5% | 10 yr | $598 | $16,760 |
| Lender B | 4.9% | 7 yr | $735 | $11,740 |
| Lender C | 6.2% | 15 yr | $471 | $29,780 |
Analysis:
| Option | Monthly Change | Interest Savings | Best For |
|---|---|---|---|
| Stay Current | — | — | Federal protections |
| Lender A | -$35/mo | $4,200 | Lower payment, same term |
| Lender B | +$102/mo | $9,220 | Fastest payoff, most savings |
| Lender C | -$162/mo | -$8,820 (costs more) | Cash flow only |
Winner for savings: Lender B – Highest savings if you can afford higher payment. Winner for cash flow: Lender C – But costs $8,820 more in interest.
Remember: Refinancing federal loans means losing federal protections.
APR Comparison Quick Reference
What’s a Good APR✓
By Loan Type (Excellent Credit):
| Loan Type | Good APR | Average APR | High APR |
|---|---|---|---|
| Mortgage | Under 6% | 6-7% | Over 7.5% |
| Auto (new) | Under 5% | 5-7% | Over 9% |
| Auto (used) | Under 6% | 6-9% | Over 11% |
| Personal | Under 10% | 10-15% | Over 20% |
| Credit Card | Under 15% | 18-22% | Over 25% |
| Student | Under 5% | 5-7% | Over 8% |
Rates as of current market conditions; vary by credit score and lender.
APR Impact by Credit Score
$20,000 Auto Loan, 60 Months:
| Credit Score | APR | Monthly Payment | Total Interest |
|---|---|---|---|
| 750+ | 5.5% | $382 | $2,891 |
| 700-749 | 7.5% | $400 | $3,980 |
| 650-699 | 11.0% | $435 | $6,078 |
| 600-649 | 15.0% | $476 | $8,565 |
| Below 600 | 20.0% | $529 | $11,756 |
A 100-point credit improvement can save $5,000-$8,000 on a single auto loan.
Hidden Costs Beyond APR
Fees That Affect True Cost
Loan Fees: | Fee | Typical Range | Impact on $20,000 Loan | |—–|—————|————————| | Origination | 1-8% | $200-$1,600 | | Application | $0-$500 | $0-$500 | | Prepayment penalty | 1-3% | $200-$600 | | Late payment | $25-$50 | Varies | | Documentation | $0-$300 | $0-$300 |
Credit Card Fees: | Fee | Typical Range | Annual Impact | |—–|—————|—————| | Annual fee | $0-$550 | Direct cost | | Balance transfer | 3-5% | One-time per transfer | | Cash advance | 3-5% + higher APR | Per transaction | | Foreign transaction | 0-3% | Per international purchase | | Late payment | $29-$40 | Per occurrence | | Over-limit | $0-$35 | Per occurrence |
The “True APR” Calculation
Include all costs:
True APR = (Interest + All Fees) ÷ Principal ÷ Term × 12 × 100Example: $10,000 loan, $1,500 interest, $500 fees, 3 years
True APR = ($1,500 + $500) ÷ $10,000 ÷ 3 × 12 × 100 = 8%Even though quoted rate might be 4.5%, the true cost is 8% APR.
How to Compare Offers Effectively
Step 1: Gather All Terms
For each offer, collect: – Interest rate – APR – All fees (origination, closing, etc.) – Loan term – Monthly payment – Prepayment penalties
Step 2: Calculate Total Cost
Total Cost = (Monthly Payment × Number of Payments) + All FeesStep 3: Calculate Cost Per $1,000
Cost Per $1,000 = Total Cost ÷ (Loan Amount ÷ 1,000)This lets you compare different loan amounts fairly.
Step 4: Consider Your Timeline
| If You’ll… | Prioritize |
|---|---|
| Pay off quickly | Lower fees, even if higher rate |
| Keep full term | Lower APR, even if higher fees |
| Refinance later | Lower monthly, flexible terms |
| Pay minimum only | Lowest possible rate |
Step 5: Factor in Your Goals
| Goal | Best Offer Has |
|---|---|
| Lowest monthly payment | Longer term, lower rate |
| Lowest total cost | Shorter term, lowest APR |
| Most flexibility | No prepayment penalty, variable options |
| Stable budget | Fixed rate, consistent payment |
Frequently Asked Questions
Why are APR and interest rate different✓
Interest rate = Base cost of borrowing (just the rate) APR = Total cost including fees, expressed annually
Example: – 5% interest rate + $600 in fees on $20,000 loan – APR accounts for fees, might show as 5.4%
APR gives you the “true” cost for comparison purposes.
Which APR matters most✓
For loans: The stated APR (includes fees) For credit cards: Purchase APR (unless doing balance transfer) For refinancing: Compare new APR to current rate
Always compare APR to APR, not APR to interest rate.
How do I compare offers with different terms✓
Calculate total cost for each:
| Offer | Term | Monthly | Total Paid | Total Interest |
|---|---|---|---|---|
| A | 36 mo | $450 | $16,200 | $1,200 |
| B | 60 mo | $300 | $18,000 | $3,000 |
Offer A costs less overall even though monthly is higher.
Also calculate cost per $1,000 borrowed for easy comparison.
Is the lowest APR always the best choice✓
Not always. Consider: – Monthly payment affordability – Total fees (low APR with high fees may cost more) – Term length (longer term = more interest even at lower APR) – Flexibility needs (prepayment options, etc.)
Sometimes a slightly higher APR with lower fees or better terms is the smarter choice.
How do fees affect the APR✓
Fees increase the effective APR:
| Scenario | Interest Rate | Fees | Effective APR |
|---|---|---|---|
| No fees | 6% | $0 | 6.0% |
| 1% origination | 6% | 1% | ~6.3% |
| 3% origination | 6% | 3% | ~6.8% |
| Points (1) | 6% | 1 point | ~6.3% |
Higher fees = higher true cost, reflected in APR.
What’s a good APR for my credit score✓
General guidelines:
| Your Score | “Good” APR (Relative) |
|---|---|
| 750+ | Best available rates |
| 700-749 | Slightly above best |
| 650-699 | Mid-range rates |
| 600-649 | Above average rates |
| Below 600 | High rates (if approved) |
Shop multiple lenders – rates vary significantly even for same credit score.
Should I choose variable or fixed APR✓
Fixed APR: – ✓ Predictable payments – ✓ Protected from rate increases – ✗ May start higher than variable – Best for: Long-term loans, tight budgets
Variable APR: – ✓ Often starts lower – ✓ Decreases if rates drop – ✗ Can increase significantly – Best for: Short-term debt, rate drop expected
How do I calculate APR myself✓
Simplified formula:
APR ≈ (2 × n × I) ÷ [P × (n + 1)]
Where:
n = Number of payments
I = Total interest + fees
P = PrincipalFor accuracy, use online calculators or the loan’s Truth in Lending disclosure.
Why do credit cards have multiple APRs✓
Different APRs for different activities:
| APR Type | What It Applies To |
|---|---|
| Purchase APR | New purchases |
| Balance Transfer APR | Transferred balances |
| Cash Advance APR | ATM withdrawals |
| Penalty APR | Triggered by late payment |
| Introductory APR | Promotional rate (temporary) |
Always check which APR applies to your planned use.
How do intro APRs affect comparison✓
Calculate for FULL loan life, not just intro period:
| Card | Intro APR | Intro Period | Regular APR |
|---|---|---|---|
| A | 0% | 12 months | 20% |
| B | 0% | 18 months | 24% |
If paying off in 10 months: Both cost zero interest If paying off in 24 months: Card A likely cheaper (lower regular APR)
Does paying points lower APR✓
Yes, but do the math:
| Option | Rate | Points | Upfront Cost | Monthly Payment | Break-Even |
|---|---|---|---|---|---|
| No points | 6.5% | 0 | $0 | $1,896 | — |
| 1 point | 6.25% | $3,000 | $3,000 | $1,847 | 61 months |
| 2 points | 6.0% | $6,000 | $6,000 | $1,799 | 62 months |
Pay points if: You’ll keep the loan past break-even point.
What if I can’t get a good APR✓
Options: 1. Improve credit first – Wait 6-12 months while building score 2. Add collateral – Secured loans have lower rates 3. Find a co-signer – Use their creditworthiness 4. Try credit unions – Often more flexible than banks 5. Look at alternative lenders – Online options may be competitive 6. Negotiate – Counter-offer with competing quotes
How often should I compare APRs✓
Check rates: – Before any new borrowing – Annually for existing debt (refinance opportunity✓) – After credit score improvement (+50 points) – When market rates drop significantly – Before major purchases
Comparing takes 15 minutes and can save thousands.
Related Calculators
Make smarter borrowing decisions:
- Rate Reduction Savings Calculator – See savings from lower rates
- Debt Consolidation Calculator – Compare consolidation options
- Balance Transfer Calculator – Evaluate transfer offers
- Refinancing Calculator – Analyze refinance options
This calculator provides estimates based on APR and terms you enter. Actual rates depend on creditworthiness, lender policies, and market conditions. APR may not include all fees; review loan disclosures carefully.