A payday loan is a small, short-term cash advance — typically $100 to $1,000 — that you repay on your next payday. Lenders almost never quote an interest rate the way a bank does. Instead they advertise a flat fee, often $15 per $100 borrowed. That number sounds small until you convert it into an annual percentage rate (APR). On a standard two-week loan, $15 per $100 works out to roughly 391% APR — far more than a credit card, a personal loan, or even most forms of high-interest debt.
This payday loan calculator takes the three numbers a lender actually gives you — the amount you borrow, the fee per $100, and the number of days until repayment — and converts them into the two numbers that matter: the total dollars you will owe on payday and the true APR regulators require lenders to disclose under Regulation Z. Use it before you sign anything, and compare it against every alternative you can find.
How to Use
- Enter the Loan Amount — the principal you want to walk out with. Most states cap payday loans between $300 and $1,000.
- Set the Finance Fee per $100. Shop around; lenders charge $10, $15, $20, or even $30 per $100 depending on the state and the store. A $1 difference here compounds across the year.
- Choose the Loan Term in days. The classic payday loan is due in 14 days, but many lenders offer 7-day, 30-day, or rollover terms.
- Read the result card. The Finance Fee is the pure dollar cost of borrowing; the Total Repayment Due is what leaves your bank account on the due date; the APR is what you would pay if the same fee repeated every two weeks for a full year.
A $500 loan with a $15-per-$100 fee for 14 days costs you $75 in fees and a $575 repayment, on an APR of about 391%. Slide the term to 30 days and the APR drops to about 183% — still brutal, but the math shows exactly why a longer term, a smaller fee, or a cheaper alternative matters.
How Payday Loan APR Is Calculated
The APR formula comes straight from Regulation Z, the truth-in-lending rule that forces every consumer lender in the United States to quote the same number:
APR = (Finance Fee ÷ Amount Financed) × (365 ÷ Term in Days) × 100
On a $500 loan with a $75 fee over 14 days:
- Finance fee ÷ amount financed = $75 ÷ $500 = 0.15 (a 15% charge for two weeks).
- Annualize that two-week charge: 0.15 × (365 ÷ 14) = 0.15 × 26.07 = 3.91.
- Multiply by 100 to get the percentage: 391.07% APR.
Notice that the fee itself — $75 — is small. The horror is the annualization. Because the loan lasts only two weeks, a 15% charge repeats twenty-six times per year if you keep reborrowing, and that is how a $75 fee becomes a 391% APR. Lenders prefer to advertise the flat $15-per-$100 number because "15%" sounds manageable; the APR tells the truth.
Why the APR Looks So High
Payday lenders defend the fee by pointing out that the loan is tiny and the duration is short. A $15 fee on $100 for two weeks is, in isolation, just $15. But the APR exists so you can compare loans of different sizes and lengths on a single scale. A 391% APR means that if you rolled the same $100 loan over, every two weeks for a full year, you would pay $391 in fees per $100 borrowed.
Consumer Financial Protection Bureau data shows that the average payday loan borrower takes out eight loans in a row — each one paying off the previous one's fee — and ends up paying $458 in fees on an original $350 balance. That is the cycle the APR is designed to expose.
Cheaper Alternatives Worth Checking First
Before you take a payday loan, run these through the same calculator or compare them side by side:
- Credit card cash advance — typically 25–30% APR plus a 3–5% upfront fee. Still expensive, but a fraction of 391%.
- Personal loan from a credit union or online lender — bad-credit borrowers often qualify for 15–36% APR over 12–36 months, and the payment is fixed.
- Borrowing from family or friends — zero interest, but formalize the repayment schedule so the relationship survives.
- Employer payroll advance or a 401(k) loan — your own money, paid back through payroll deductions at the prime rate.
- Local assistance programs — church benevolence funds, community charities, or state emergency-grant programs often cover one-time expenses with no fee at all.
Examples
Example 1 — The classic $500 two-week loan. Borrow $500 at $15 per $100 for 14 days. The finance fee is $500 × 15 ÷ 100 = $75. Total repayment on payday is $575. The APR is (15 ÷ 100) × (365 ÷ 14) × 100 = 391.07%. For comparison, a 25% APR credit card would charge you about $4.79 in interest over the same 14 days — not $75.
Example 2 — A smaller fee, shorter term. Borrow $300 at $10 per $100 for 7 days. The fee is $30, total repayment $330, and the APR is (10 ÷ 100) × (365 ÷ 7) × 100 = 521.43%. The smaller dollar fee does not help: because the term is even shorter, the annualized rate is worse.
Example 3 — Stretching the same loan to a month. Same $500 and same $15-per-$100 fee, but a 30-day term. Fee is still $75, total repayment $575, but the APR drops to (15 ÷ 100) × (365 ÷ 30) × 100 = 182.50%. The dollar cost is identical; the APR halves because the fee is spread over twice the time.
Example 4 — The large-loan stress test. Borrow $1,000,000 at the same $15-per-$100 for 14 days (a legal maximum in theory, not practice). The fee is $150,000 and total repayment is $1,150,000 on the same 391.07% APR. The ratio — and therefore the APR — is scale-invariant, which is the point: the percentage punishes short duration, not principal size.
FAQ
How much does a $500 payday loan cost?
At the typical $15-per-$100 rate, a $500 two-week loan costs a $75 finance fee and a $575 total repayment. The equivalent APR is about 391%. If you roll the loan over for another two weeks, you pay another $75 — and a year of rollovers would cost $1,950 in fees on a $500 principal.
What is the average APR on a payday loan?
Regulation Z disclosures typically show payday loan APRs between 300% and 600%. A $15-per-$100 fee for 14 days yields 391%; a $15-per-$100 fee for 7 days yields 782%; a $30-per-$100 fee for 14 days yields 782%. State laws cap fees in some states, which pulls the disclosed APR down, but the dollar cost remains high.
Are payday loans illegal?
They are legal in roughly 36 states, with fee caps and principal caps set by state law. In the remaining states, either small-loan interest-rate ceilings effectively ban them, or lenders must partner with nationally chartered banks to offer loans across state lines. Always check your state's current small-loan statute before borrowing.
What happens if I cannot pay back on payday?
The lender typically offers to "roll over" or renew the loan by charging the same fee again — $75 on a $500 loan — and pushing the due date out another two weeks. CFPB data shows borrowers who roll over repeatedly spend months paying fees without ever touching the principal. A bank overdraft fee, while annoying, is almost always cheaper than a rollover cycle.
Is there a cheaper alternative to a payday loan?
Usually, yes. A credit card cash advance runs 25–30% APR; a credit-union personal loan may be 18–36%; a 401(k) loan is the prime rate plus 1–2%; and a local charity or employer advance may cost zero. Run each alternative through this calculator side by side — the dollar gap is almost always enormous.
Can I pay a payday loan off early?
Most loans allow early repayment with no prepayment penalty, but verify in writing before you borrow. Paying early reduces the number of days you owe, which lowers the effective dollar cost in many fee structures, though lenders who charge a flat per-$100 fee will not refund the difference.
How much can I borrow with a payday loan?
State statutes usually cap payday principal at $300 to $1,000 per loan, and many states limit borrowers to one or two outstanding loans at a time. Lenders also verify income (typically $1,000+ per month) and require an active checking account and proof of a U.S. address.
Disclaimer
This payday loan calculator is provided for informational purposes only and does not constitute financial, lending, legal, or credit advice. The APR uses the Regulation Z simple-interest convention (365-day year) and may differ slightly from a lender's disclosure, which sometimes uses a 360-day year or includes additional fees. Actual offers, fee caps, and rollover rules vary by state and by lender. Always read the loan agreement, confirm the finance charge and APR in writing, and explore cheaper alternatives before committing to a short-term cash advance.