Why Points Raise the APR

This loan origination points to APR calculator shows the real cost of upfront charges. Paying one point on a $300,000 loan hands $3,000 to the lender immediately, yet you still repay the full $300,000 — so the effective annual rate exceeds the quoted nominal rate.

The APR Equation

The true APR is the discount rate that equates the present value of all monthly payments with the net amount you actually receive (loan minus points minus fees). The calculator solves this nonlinear equation numerically to a tight tolerance.

Comparing Loan Offers

Lenders quote different combinations of rate, points, and fees. Converting every offer to a single true APR — as this calculator does — is the honest way to compare them, because it folds all upfront costs into one number.