Interest Rate Calculator
Calculate various interest rates including nominal, effective annual, and APR for loans and deposits
Calculate Interest Rate
Principal amount borrowed
Years
Months
Amount paid per period
How often payments are made
How often interest compounds
Fees paid upfront (processing, origination)
Fees rolled into the loan amount
Interest Rate Results
Calculation Details
Type: Loan
Term: 5 years 0 months
Compounding: Monthly
Payment Frequency: Monthly
Payment Breakdown
Principal: $10,000
Total Interest: $2,000
Total Fees: $0
Total Cost: $12,000
Rate Analysis
Example Calculation
Loan Example
Loan Amount: $10,000
Term: 5 years
Monthly Payment: $200
Prepaid Fees: $200
Loaned Fees: $300
Results
Nominal Interest Rate: ~13.12%
Effective Annual Rate: ~13.93%
Annual Percentage Rate: ~14.98%
Total Payments: $12,000
Total Interest: $1,700
Types of Interest Rates
Nominal Rate
Simple annual rate without compounding
Effective Annual Rate
Rate including compounding effects
APR
Rate including all fees and costs
Periodic Rate
Rate per compounding period
Key Formulas
Loan Payment
P = (A × i × (1+i)^n) / ((1+i)^n - 1)
Compound Interest
F = A × (1 + r/m)^(mt)
Effective Annual Rate
EAR = (1 + r/m)^m - 1
Financial Tips
Compare APR when shopping for loans
Higher compounding frequency increases effective rate
Include all fees in your cost comparison
Consider inflation when evaluating returns
Understanding Interest Rates
What is Interest Rate?
Interest rate represents the cost of borrowing money or the return on invested money, expressed as a percentage of the principal amount per year. It's the fundamental concept in finance that connects present and future value of money.
Why Calculate Interest Rates?
- •Compare different loan and investment options
- •Understand the true cost of borrowing
- •Evaluate investment performance and returns
- •Make informed financial decisions
Types of Interest Rates
Nominal Annual Rate
The stated annual interest rate without considering compounding effects. Also called simple interest rate.
Effective Annual Rate (EAR)
The actual annual rate considering compounding frequency. Always higher than nominal rate when compounding occurs.
Annual Percentage Rate (APR)
Total cost of borrowing including interest and all fees, expressed as a yearly rate. Best for loan comparison.