What is the difference between the interest rate and the APR?
The Annual Percentage Rate (APR) is the yearly cost of a mortgage expressed as
a percentage, and takes into account the total cost of a loan, including the
interest rate and other finance changes (e.g., closing fees and points). The
interest rate consists solely of the cost for borrowing a lender's money.
Using an APR allows a borrower to more accurately compare the true
costs of various loans offered by different lenders, or different loan programs
offered by the same lender.