Question 1

What APR does a $20,000, 8%, 5-year loan with $600 fees have?

Accepted Answer

About 9.30%.

Question 2

What is the difference between APR and APY?

Accepted Answer

APR here is the monthly rate × 12; APY compounds the monthly rate over 12 months, so it is higher.

Question 3

Why does the APR rise if I repay early?

Accepted Answer

The upfront fee is spread over a shorter time, so the cost per year increases.

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