Interest rate calculator
The interest rate on a loan from the amount, the monthly payment and the term.
About this calculator
This interest rate calculator works out the rate you are really paying on a loan. Enter the amount borrowed, the monthly payment and how long the loan lasts.
It's useful for checking a dealer or store finance offer, or a loan where you only know the payment.
How it works
Finds the rate at which the level-payment formula gives exactly your monthly payment for that amount and term. The effective yearly rate shows the effect of monthly compounding.
Last reviewed:
Worked example
- Loan amount: $20,000
- Monthly payment: $400
- Term: 5 years
Interest rate: 7.42% (a year)
Common questions
Why is my rate different from the advertised one?
Fees and add-ons can be built into the payment, which raises the real rate. Enter the amount you actually receive to see the true cost.
What is the effective yearly rate?
The rate once monthly compounding is included. A 12% yearly rate charged monthly works out to about 12.68% a year.
Can I use this for savings?
This calculator is for loans repaid in equal monthly payments. For savings, use the compound interest or savings calculator.
The story behind it
Where the idea came from: Lenders and borrowers have argued over interest rates for thousands of years, and many ancient societies set legal limits on them.
Finding the rate from a payment can't be done with one simple formula, so people once used trial and error with printed tables. A computer can search for the exact rate in a fraction of a second, which is what this calculator does.
Why you can trust this calculator
- It runs in your browser. Nothing you type into it is sent anywhere.
- The method is explained on this page, so you can check it yourself.
- Free to use, with no sign-up.
- Results are estimates, not financial advice.
- Spotted a mistake? Tell us and we'll look into it.
After 15 years as a mathematics educator, I built CalculStore to give students, teachers, professionals and anyone working with numbers simple, reliable tools.
Meet the founder