How it works
- Enter each offer: amount, interest rate, term in years and upfront fee percentage. Sample offers are filled in to start.
- Optionally add an extra monthly payment to see how much sooner and cheaper the loan ends.
- Compare total cost and effective APR. The cheapest offer is highlighted.
- Print or save the comparison to share with your accountant or partner.
Rate is not the same as cost
A loan with a low rate but a long term can cost far more in total interest than a shorter loan at a higher rate. Origination and guarantee fees also reduce the money you actually receive, so the effective APR is higher than the quoted rate. Comparing total cost of borrowing and effective APR is the only fair way to rank offers.
How the calculation works
Monthly payment uses the standard amortization formula for a fixed-rate loan. Total cost is all interest plus the upfront fee. Effective APR is the annual rate at which your payments repay the net amount you receive after the fee. Variable-rate loans, balloon payments and prepayment penalties are not included.