apr defined
Annual Percentage Rate - APR. What is an 'Annual Percentage Rate - APR'. An annual percentage rate (APR) is the annual rate charged for borrowing or earned through an investment, and is expressed as a percentage that represents the actual yearly cost of funds over the term of a loan. 1. 1  the annual equivalent of a rate of interest when the rate is quoted more frequently than annually, usually monthly APR. 2  the annual equivalent of a rate of interest when the rate is quoted more frequently than annually, usually monthly APR. The term annual percentage rate of charge (APR), corresponding sometimes to a nominal APR and sometimes to an effective APR (or EAPR), describes the interest rate for a whole year (annualized), rather than just a monthly fee/rate, as applied on a loan, mortgage loan, credit card, etc. It is a finance charge expressed as an annual rate. 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. In some areas, the annual percentage rate (APR) is the simplified counterpart to the effective interest rate that the borrower will pay on a loan. In many countries and jurisdictions, lenders (such as banks) are required to disclose the cost of borrowing in some standardized way as a form of consumer protection. TRENDING NOW. 1  nonnuclear 'Not nuclear'. 2  armada 'A fleet of warships'. 3  volunteer 'Someone who does something without being forced to do it'. 4  operationalize Bannon was removed from the National Security Council.  filibuster 'An effort to prevent action in a legislature'. Join MWU now and get access to America’s largest dictionary, with: 1  300,000 words that aren't in our free dictionary. 2  Expanded definitions, etymologies, and usage notes. 3  Advanced search features.  Ad free! Annual Percentage Rate. Definition. APR. The yearly cost of a mortgage, including interest, mortgage insurance, and the origination fee (points), expressed as a percentage. The annual percentage rate can be looked at in two primary ways: the nominal rate, which is a non-adjusted simple interest rate, or the effective rate, which takes compound interest into account. : a measure of the annual percentage cost of consumer credit (as in installment buying or a charge account) that is required by law to appear on statements of credit accounts and is variously computed but always takes into consideration the amount financed, the amount of the finance charges, and the schedule of repayment —abbreviation APR. Significantly, the APR does not account for compounding. For example, if the APR is 36%, the percentage is 3% per month, but the interest rate or cost of funds for the entire year may be greater than 36% due to the effects of compounding.
It is the annual rate charged for borrowing or earned through an investment.