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Annual percentage rate

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Annual percentage rate (APR)
The periodic rate times the number of periods in a year. For example, a 5% quarterly return has an APR of 20%.

Annual percentage rate (APR). A loan's annual percentage rate, or APR, is what credit costs you each year, expressed as a percentage of the loan amount.

The APR, which is usually higher than the nominal, or named, rate you're quoted for a loan, includes most of a loan's up-front fees as well as the annual interest rate.

You should use APR, which is a more accurate picture of the cost of borrowing than the interest rate alone, to compare various loans you're considering.



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The annual percentage rate is much higher than the listed interest rate.
The 2002 revisions to Regulation C require lenders to collect and report data including loan pricing information (the rate spread between the annual percentage rate on the loan and the yield on Treasury securities of comparable maturity); whether the loan is subject to the Home Ownership and Equity Protection Act; whether manufactured housing is involved; whether the loan is secured by a first or subordinate lien on the property; and certain information about requests for preapproval.
The RAL's annual percentage rate can be as low as 70 percent or as high as 700 percent.
 
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