The 6% interest rate is then used to calculate a new annual payment of $12,300. To calculate the APR, simply divide the annual payment of $12,300 by the original loan amount of $200,000 to get 6.15%.
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How Is APR Calculated? APR is calculated by multiplying the periodic interest rate by the number of periods in a year in which it was applied . It does not indicate how many times the rate is actually applied to the balance.
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