Interest Rate Calculator
Solve for loan interest rate.
Inputs
$
$
Result
Effective APR7.42%
About the Interest Rate Calculator
The Interest Rate Calculator solves for the APR that produces a known monthly payment on a loan of a given amount and term. Use it to reverse-engineer the rate on a quoted payment.
Calculation method
Solves the amortizing-loan formula for r using numerical bisection.
Solve M = P × r × (1+r)^n / ((1+r)^n − 1) for rHow to use this calculator
- Enter the loan amount.
- Enter the monthly payment.
- Enter the term in months.
Example
A $20,000 loan with a $415 payment for 60 months implies an APR of about 9.0%.
Frequently asked questions
Why does the rate matter more than the payment?
Two loans with similar payments can have very different rates and total interest if terms differ. Always compare APR.
Are teaser rates real?
Yes, but the promotional rate usually ends after a set period. Read the fine print for the go-to rate and any fees.
What if the answer is far from the quoted rate?
The lender may be adding financed fees to the principal, inflating the effective rate. Re-check the amount financed shown on the truth-in-lending disclosure.
Disclaimer: This calculator is for informational and educational purposes only and does not constitute financial, tax, or legal advice. Consult a qualified professional for decisions specific to your situation.