Payday Loan Calculator
Calculate the true cost of a payday loan including fees and equivalent APR. Payday loans charge fees per $100 borrowed that translate to extremely high annual rates. Before taking a payday loan, consider alternatives like a personal loan or budget planning.
Warning: Payday loans carry extremely high costs. A typical $15 per $100 fee for 14 days equals 391% APR. Consider all alternatives before borrowing.
How to Calculate Payday Loan Cost
- Determine the loan amount you need to borrow.
- Find the fee charged per $100 borrowed (typically $10-$30).
- Multiply the loan amount by the fee rate to get the total fee.
- Add the fee to the loan amount for total repayment due on your next payday.
- Calculate the equivalent APR to understand the true annual cost.
Formula
Total Fee = (Loan Amount / 100) x Fee per $100
Total Repayment = Loan Amount + Total Fee
APR = (Total Fee / Loan Amount) x (365 / Loan Term in Days) x 100
Example: $15 fee per $100 for 14 days
APR = ($15 / $100) x (365 / 14) x 100 = 391%Example
You borrow $500 with a $15 per $100 fee for 14 days:
Loan Amount = $500
Fee = $15 per $100
Term = 14 days
Total Fee = ($500 / $100) x $15 = 5 x $15 = $75
Total Repayment = $500 + $75 = $575
APR = ($75 / $500) x (365 / 14) x 100
= 0.15 x 26.07 x 100
= 391%
If you rolled over this loan 4 times (8 weeks):
Total fees = $75 x 4 = $300 (60% of original loan!)
You would have paid $300 in fees and still owe $500.Payday Loan APR Comparison Table
| Fee per $100 | 7-day APR | 14-day APR | 30-day APR | Fee on $500 |
|---|---|---|---|---|
| $10 | 521% | 261% | 122% | $50 |
| $15 | 782% | 391% | 182% | $75 |
| $20 | 1043% | 521% | 243% | $100 |
| $25 | 1304% | 652% | 304% | $125 |
| $30 | 1564% | 782% | 365% | $150 |
Compare: credit cards charge 15-30% APR, personal loans 6-36% APR
Frequently Asked Questions
Why are payday loans so expensive?
Payday loans charge flat fees that seem small ($15 per $100) but translate to 300-700% APR because the loan term is so short (1-4 weeks). The fee is charged on the full amount regardless of how quickly you repay.
What happens if I cannot repay on time?
Most lenders offer a rollover, charging another full fee to extend the loan. This creates a debt cycle where you pay fees repeatedly without reducing the principal. Some states limit rollovers to prevent this trap.
What are alternatives to payday loans?
Consider: paycheck advances from your employer, credit union payday alternative loans (PALs) at 28% max APR, credit card cash advances (25-30% APR), personal loans, borrowing from family, or negotiating payment plans with creditors.
Are payday loans legal everywhere?
No. Some states ban payday lending entirely (e.g., New York, New Jersey), while others cap fees or limit rollovers. Federal regulations require lenders to disclose the APR. Check your state laws before borrowing.
How do I break the payday loan cycle?
Stop rolling over loans. Consider a debt consolidation loan at a lower rate, negotiate an extended payment plan with the lender (many are required to offer one), build an emergency fund even if small ($500-$1,000), and create a budget to prevent future shortfalls.