# Loan Comparison Calculator

Loan Comparison Calculator
Loan 1:
Principal \$
Months
Closing Fees \$
Fees are financed (rolled into total amount borrowed). APR =
Fees are paid in full with down payment. Annual interest rate =
%
Loan 2:
Principal \$
Months
Closing Fees \$
Fees are financed (rolled into total amount borrowed). APR =
Fees are paid in full with down payment. Annual interest rate =
%

When financing a home or new vehicle, comparing several loan offers is crucial to getting the best deal. Loan offers may vary in their the total price of closing fees, rates, lengths of time, or principals. You can compare the monthly payments and totals of fees and interest by using the loan comparison calculator on the left. Depending on your budget and financial goals, you may be better off with a loan that has low monthly payments, or a loan with a shorter term so that you can pay off your debt faster.

*A note on the difference between APR and Annual Interest Rate: The annual interest rate is the rate on the principal alone. APR is the actual interest rate when the closing fees are financed and rolled into the total amount borrowed. For example, suppose you take out a loan for \$10,000 for 5 years at an annual interest rate of 5% with closing fees of \$500. If you pay the fees in full at the start of the lending term, then your monthly payments are \$188.71.

If you finance the \$500 along with the \$10,000, then it is as if you are borrowing \$10,500 at an annual interest rate of 5%. Your monthly payments would then be \$198.15. Equivalently, if you borrow \$10,000 at an annual rate of 7.03%, your monthly payments would also be \$198.15. The rate 7.03% is called the Annual Percentage Rate (APR).

If you are comparing loan terms in which the fees are financed, then the APR will be listed on the lending agreement along with the annual interest rate. To use the loan comparison calculator, enter either the annual interest rate or the APR depending on whether the closing fees are paid up front or financed.