ST Alpha - "APR is calculated after reducing the principal by points and certain fees." (Reading a Post)

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In response to "For loans, what's the difference between 5.75% interest rate and 6.88% APR?" by Beryllium

APR is calculated after reducing the principal by points and certain fees.

Posted by znufrii Mar 15 '20, 19:37

so if you take a $100,000 loan with 1% in points and fees, they calculate the APR by considering the interest you pay as if it were on $99,000 instead of $100,000.

Responses:

*pulls out the whiteboard* -- nm - Katie Porter Mar 15, 19:40 2
- If I'm doing the math correctly, it works out to about 16.5% in points and fees upfront? -- (edited) - znufrii Mar 15, 19:42 1
  - maybe not quite that high, because I forgot to account for compounding. -- (edited) - znufrii Mar 15, 20:10

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APR is calculated after reducing the principal by points and certain fees.

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