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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