APR

APR (Annual Percentage Rate)

APR stands for annual percentage rate. This calculation allows consumers to benchmark the cost of borrowing. General the lower the APR the more compeditive the borrowing costs are, although there are factors to consider such as whether the APR is variable or fixed for the loan term. Make sure you are considering the same sort of finance plan ie, a mortgage APR against a Hire Purchase APR are different types of loans.

APR takes into account the amount of interest you pay and any other fees charged by the provider such as arrangement or document fees. It also takes into consideration when and how often interest and charges are paid.