Finance Charge Calculator

Finance Charge Calculator to calculate finance charge for credit card, mortgage, auto loan or personal loans. The Finance charge formula below shows how to calculate finance charge for a loan. Simply enter the current balance, APR, and the billing cycle length, and the finance charge along with your new loan balance will be calculated.

How to Calculate Finance Charge

Following is the general finance charge formula that shows how to calculate finance charge quickly and easily.

Finance Charge = Current Balance * Periodic rate, where
Periodic Rate = APR * billing cycle length / number of billing cycles in the period.

For example, following is how we calculate the finance charge for a loan of $1,000 with a 18% APR and a billing cyles of 25 days.

1. Convert APR to decimal: 18/100 = 0.18
2. Calculate period rate: 0.18 * 25 / 365 = 0.0123
3. Calculate finance charge: 1000 * 0.0123 = 12.33

* billing cycle is 365 in a year since we are calculating by "days". If we were to use months, then the number of billing cycles is 12 or 52 if we were calculating by week.