Loan Comparison Calculator
Two loan offers, side by side — payment, total cost, and APR to see which actually wins
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Quick summary
The lowest rate doesn't always win — fees shift the real cost. Enter each offer's amount, rate, term, and fees; the calculator computes monthly payment, total interest, total cost (including fees), and an approximate APR that spreads fees over the loan term as an effective rate. A slightly higher rate with much lower fees can beat a low-rate offer loaded with points, especially if you won't hold the loan the full term.
Reviewed by Simple Calculators TeamLast reviewed
For planning only — not financial or tax advice. Results are estimates based on your inputs and the stated assumptions. Confirm important decisions with a qualified professional.
How to use this calculator
- Enter the inputs requested by the calculator.
- Choose the units or options that match your situation and review the assumptions.
- Run or update the calculation to see the result.
- Review the result, breakdown, and formulas shown on the page.
- Check the inputs, units, dates, and limitations before saving or sharing the result.
Frequently asked questions
How do I compare two loan offers fairly?
Compare total cost over the full term (payments + fees), not just the monthly payment or the headline rate alone. A lower rate with $5,000 in points can cost more than a slightly higher no-fee rate if you don't keep the loan long enough to earn back the points — this calculator's APR figure captures that trade-off automatically.
Why is APR different from the interest rate?
The interest rate prices only the money borrowed; APR spreads upfront fees (origination, points, some closing costs) over the loan term as an equivalent rate, so a 6.5% loan with $3,000 in fees might carry a 6.7% APR. Regulation requires APR disclosure precisely so borrowers can compare offers with different fee structures on equal footing.
Should I pay points to lower my rate?
Only if you'll keep the loan past the break-even point — divide the point cost by the monthly savings to find how many months until they pay off. If you might sell or refinance sooner, the no-points offer usually wins even at a higher rate.
What fees should I include when comparing loans?
Origination fees, discount points, underwriting fees, and any lender-charged closing costs — anything the lender requires as a condition of the loan. Third-party costs like appraisal or title insurance are usually similar across lenders and can be left out of the comparison.
Key terms
- APR
- Annual percentage rate — the interest rate plus fees spread over the term, for apples-to-apples comparison.
- Points
- Prepaid interest (1 point = 1% of the loan) that buys a lower rate — worth it only if you keep the loan long enough.
- Break-Even Point
- Fee cost ÷ monthly savings — the point at which a lower rate has paid for itself.
- Total Cost
- All payments over the full term plus upfront fees — the true price of a loan.
Methodology, sources & limitations
This page shows the formula, assumptions, and limitations used for this estimate. Rates, thresholds, and other time-sensitive inputs can change, so verify them against the relevant official source before relying on a result.
For our review approach and the primary sources we consult, see the methodology and source policy. If you spot an outdated figure or formula, please contact us with a correction.