APR

APR means Annual Percentage Rate. In simple terms, APR shows the yearly cost of borrowing money, including interest and certain fees. APR is important because it helps borrowers compare the real cost of different loans or credit cards. A loan with a lower interest rate may still have a higher APR if it includes large fees. For example, if two loans have the same interest rate but one has higher fees, the loan with higher fees may have a higher APR. APR is not always the same as the interest rate. The interest rate shows the cost of borrowing the principal, while APR gives a broader view of the yearly borrowing cost.