Mortgage APR Calculator
About This APR Calculator
Our mortgage APR calculator helps you understand the true cost of your mortgage by factoring in all loan-related costs. It shows you:
- Annual Percentage Rate (APR) calculation
- Total closing costs breakdown
- Impact of points and fees on your loan
- Complete cost analysis over the loan term
- Visual comparison of all costs involved
Understanding APR vs. Interest Rate
Interest Rate
- Base cost of borrowing
- Used to calculate monthly payments
- Doesn't include fees
- Often lower than APR
APR
- Total cost of borrowing
- Includes points and fees
- More accurate for comparison
- Required disclosure by law
Closing Costs & Fees Explained
Points
- One point equals 1% of loan amount
- Can lower interest rate
- Paid upfront
- Tax-deductible
Origination Fees
- Lender processing fees
- Usually 0.5% to 1% of loan
- May be negotiable
- Varies by lender
Other Closing Costs
- Appraisal fees
- Title insurance
- Recording fees
- Third-party services
When to Pay Points
Good Scenarios
- Plan to keep home long-term
- Have extra cash available
- Want lowest possible rate
- Current rates are high
- Break-even period is reasonable
Not Recommended When
- Planning to move/refinance soon
- Cash is limited
- Rates are already low
- Break-even period is too long
- Better investment options exist
Tips for Lower APR
- Shop Multiple Lenders: Compare APRs and closing costs
- Negotiate Fees: Many fees are negotiable
- Improve Credit Score: Better scores mean better rates
- Make Larger Down Payment: Can reduce rates and fees
- Consider No-Point Loans: May be better for shorter-term ownership
Important Notes:
- APR assumes you'll keep the loan for its full term
- Actual costs may vary by lender and location
- Some fees are negotiable, others are fixed
- Consider your long-term plans when evaluating options
- Consult with multiple lenders for best results