A $500 payday loan with a 15% fee for 14 days costs $75 upfront - and the APR hits 391%. Extend it twice and you have paid $225 in fees on a $500 loan. Enter your amount and term to see the real cost before you sign.
$2000 Payday Loan - How Much Does It Really Cost?
A $500 payday loan with a 15% fee for 14 days costs $75 upfront - and the APR hits 391%. Extend it twice and you have paid $225 in fees on a $500 loan. Enter your amount and term to see the real cost before you sign.
Borrowing $2000 as a payday loan. The fee looks small - maybe $15-30 per $100 for two weeks. But annualized, that is 390-780% APR. On a $2000 loan, the total repayment after just 14 days includes a fee that would be equivalent to thousands per year. Enter the fee and term to see the shocking true APR.
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Every payday loan hides its real cost in three separate fees
The advertised "$15 per $100" sounds manageable. But that single number masks an origination fee, nominal interest, and sometimes a processing charge - all stacked on top of the principal. A $500 loan at 15% fee for 14 days means you repay $576.38. The annualized rate? 391%. Roll it over once and the fees alone exceed $150 on a $500 loan. This calculator splits every dollar so you can see exactly where your money goes before you sign anything.
How the cost breaks down - step by step
Three components make up the total cost of a payday loan:
- Origination fee - a one-time percentage of the loan amount. Range: 10-25%. On a $500 loan at 15%, that is $75. This single fee accounts for 80-95% of the total cost on short-term loans.
- Interest - charged daily based on an annual rate. At 7.2% per year, a $500 loan for 14 days accrues just $1.38 in interest. The fee does the heavy lifting.
- Setup/processing fee - a flat dollar amount some lenders charge on top. Not universal. When present, typically $10-$50.
| Component | Typical range | Example ($500 / 14 days) |
|---|---|---|
| Origination fee | 10-25% | $75.00 (15%) |
| Interest | 5-10% annual | $1.38 (7.2% / 365 x 14) |
| Setup fee | $0-$50 | $0 |
| Total cost | $76.38 |
How to use this calculator - step by step
- Loan amount - enter the principal you plan to borrow. Typical range: $100 to $1,500.
- Loan term - enter the number of days until repayment. Most payday loans: 7-30 days.
- Origination fee - enter the lender's fee as a percentage. If the lender quotes "$15 per $100", enter 15.
- Annual interest rate - enter the nominal annual rate if stated. Many lenders show 0% but charge high fees instead.
- Setup fee - enter any flat processing charge. Leave at 0 if none.
- Read the results - see total repayment, cost breakdown, daily cost, cost per $1,000, and APR.
Cost comparison table - amounts and terms
Origination fee: 15%, annual interest: 7.2%, no setup fee.
| Loan amount | 7 days | 14 days | 30 days |
|---|---|---|---|
| $300 | $45.41 | $45.83 | $46.78 |
| $500 | $75.69 | $76.38 | $77.97 |
| $1,000 | $151.38 | $152.77 | $155.95 |
| $2,000 | $302.76 | $305.53 | $311.89 |
On short loans (7 days), the fee dominates - interest adds pennies. On longer terms (30 days), interest grows but still accounts for less than 10% of the total cost.
Practical examples
Cost: $80.00 - Total repayment: $480.00 - APR: 34,230%
Cost: $77.97 - Total repayment: $577.97 - APR: 4,058%
Cost: $126.37 - Total repayment: $1,126.37 - APR: 127,803%
Cost: $45.00 - Total repayment: $345.00 - APR: 25,922%
Cost: $476.27 - Total repayment: $2,476.27 - APR: 880%
Why payday loan APRs look astronomical
A $500 loan for 14 days at 15% fee shows an APR above 25,000%. That does not mean you pay 250x the principal. APR annualizes a one-time cost as if you renewed it every two weeks for a full year - which is 26 rollovers. In that scenario, you would pay $1,950 in fees on a $500 loan. The APR is useful for comparing bank loans that last months or years. For payday loans, compare the total repayment amount and cost per $1,000 borrowed instead.
The rollover trap
Cannot repay on time? Most lenders offer a rollover - extending the term for another cycle. The catch: you pay the full fee again on the same principal. Two rollovers on a $500 loan at 15% fee = $225 in fees, and the original $500 is still untouched. Three rollovers = $300. At that point, you have paid 60% of the loan in fees alone without reducing the balance by a single dollar.
FAQ - Frequently asked questions
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Reviewed by: Krystian Szyszka