




An annual percentage rate, often referred to by its acronym APR, is the yearly interest due on a loan, including interest and other fees, expressed as a percentage of the amount borrowed. Because the annual percentage rate incorporates all fees associated with the loan, the annual percentage rate can be used to determine the true cost of borrowing a given amount of money. The annual percentage rate is important as a standardized measure of the cost of borrowing money; the annual percentage rate allows for the comparability of interest rates across lenders. In fact, lenders are required by law to tell borrowers what their annual percentage rate would be on a loan. The annual percentage rate is calculated by multiplying the periodic interest rate by the number of periods in a year.
Rate this Annual Percentage Rate definition...




Where is the market headed? The answer may surprise you. Find out with the exclusive & Barron's recommended charts of Chart of the Day. 

Popular Terms: real GDP, per diem, APR, open position, exdividend date, current ratio, VIX, Zero Cost Collar, reverse mortgage, option premium, LIBOR, 1031 exchange, risk management, phantom income, cancelled check, FICO score, command economy, whollyowned subsidiary, dividends payable, EBITDA, stock market close, balance sheet, deferred revenue, minority interest, irrevocable trust, deferred tax, required rate of return, 144a, FTSE, in escrow, limit order, stock split, implied volatility, debt service coverage, annual return, labor relations, quality assurance, exdividend, average price per share, inflation, 401a, 1035 exchange, class C shares, diluted share, margin rate, Key Rate Duration, retained earnings, liquidity ratio, covered put


 