




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


 