How the payday loan cost calculator works
Enter the amount you want to borrow, the lender's fee, and the loan term in days. The calculator finds the cost per $100 borrowed, then annualizes it into an effective APR you can compare with any other loan.
That single APR number cuts through the marketing. A fee that looks tiny over two weeks looks very different stretched across a full year.
Worked example: $75 on $500 equals 391.1% APR
Borrow $500 with a $75 fee due in 14 days. That's $15 per $100 borrowed — and annualized, it works out to an effective APR of 391.1%. Few numbers in personal finance are that stark.
Roll that loan over a few times — the industry's common pattern — and the fees alone can exceed the original $500 you borrowed.
What to watch out for
The biggest danger is the rollover trap: unable to repay in two weeks, borrowers pay another fee to extend — again and again. Each rollover is a fresh charge on the same borrowed dollars.
Before signing, check alternatives: a payment plan with the biller, a small personal loan, a credit union payday-alternative loan, or local assistance programs. This calculator gives estimates for education, not financial advice.
Frequently asked questions
Why is payday loan APR so high?
The fee is priced for days, but APR annualizes it. A $15 fee per $100 over 14 days repeats roughly 26 times in a year — that's the math behind 391% APR. The fee itself is fixed; the APR just shows its true yearly scale.
Are payday loans ever a good idea?
Rarely. They make sense only as a true last resort — a small, one-time gap you can fully repay on your next paycheck with zero rollovers. In almost every other case, the fee structure makes a tight situation worse.
What are alternatives to payday loans?
Ask the biller for a payment plan or extension — many offer them free. Credit unions offer payday-alternative loans (PALs) capped at 28% APR. A small personal loan, a 0% credit card offer, or local nonprofit assistance can also bridge the gap.
Can a payday loan affect my credit score?
Most payday lenders don't report on-time payments, so repaying won't build credit. But if the debt goes to collections, that collection account can damage your score for years. Defaulting also risks aggressive collection tactics.