Annual Percentage Rate (APR)

A measurement used to compare different loans offered by competing lenders, which takes into account both the interest rate and closing fees

Unlike an interest rate, an APR gives you a bigger picture when shopping for the best deal on a loan. An APR lets you see the total cost of a mortgage, including closing fees and lender points over the life of a loan - not just the interest due. Even though lenders are required by law to show a loan’s APR, they do not all use the same fees in their calculation, skewing the comparison. So always check tomake sure that the APRs you are comparing include similar fees.