Simple Interest Method

Where:
principle = amount borrowed
rate = interest rate

APR The annual percentage rate (APR) of a loan tells you what percent of the total amount of money you pay for the loan goes toward finance charges.

This calculator gives the annual percentage rate of a single-payment loan (a loan that is paid in one lump sum on a specified date) that is paid using the simple interest method.

To do this calculation, you must first calculate the amount of money each year that you'll pay for interest (in this case, interest counts as finance charges.) After that is calculated, you can go on to find what percentage of your money will go toward interest charges (your APR.)

Note that in every case of the simple interest method of APR, the APR will always be equal to the interest rate of the loan. For example, say you take out a loan to buy a car and the interest rate of that loan is 13%. The APR for that loan (the percentage of the total amount of money you'll pay for the loan that'll go toward interest) will be 13 percent.