What is the different between APR and interest rate?

Answer 1

APR (Anuual Percentage Rate)...which is the annual (yearly) amount paid. So, if your interest rate is 15%, you figure what you owe - take it times your APR, divide by 12 (for 12 months in year)- then you have what you are paying each month. On a simple loan, you pay less to interest and more to principal (what you still owe each month.) Example- you have a car loan for 5,000. Your payment is $200.00......each month more goes to the reduce your balance and less goes to interest.

Answer 2

APR stands for Annual Periodic Rate. Basically, it is the same thing as the interest rate. If you have a loan, your APR indicates what percentage of the loan amount that your lender chages you in a year to use its money. If you have a savings account or certificate of deposit, then the APR tells you what amount the bank is willing to pay you for the privilege of holding on to your money for a year. There is another set of letters, APY, Annual Periodic Yield, that means what you get as your money compounds over a year.

Answer 3

Interest rate is what you actually pay (or receive)

APR (annual percentage rate) is what you would pay (or receive) if it was all done at the end of 12 months.

Use of APR enables things to be compared on the same basis. It is required by the government, to stop lenders etc. bamboozling people

Answer 4

Ondre's answer is useless-on. On basically any personal loan, the APR is continuously larger than the note price of interest you're paying. Your funds are calculated at 6.875%. With final expenditures amortized over the existence of the deepest loan, your APR is larger. If I were you, i could be better in contact about the speed and expenditures than the APR spread. The APR spread is thoroughly accepted. Your price is about a million% larger than the going 30 365 days fixed price at the moment, and $7K in final expenditures looks severe, till that still incorporates installation your new escrow account. $5-6K could be better in line. till you've credit subject matters, are taking a no-income verification personal loan, or will be financing better than 80% of your own loan to value without paying PMI (paying personal loan insurance by ability of your larger price), the speed you're being presented is only too severe. start up procuring some better. i could recommend emailing Ondre, he looks tremendous, and knowledgable.

Answer 5

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