Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

What’s so difficult about comparing Annual Percentage Rates (APR)?

0
Posted

What’s so difficult about comparing Annual Percentage Rates (APR)?

0

Your “note rate”, i.e. 8%, is used to calculate your interest on principal, and by extension, your monthly payments. The annual percentage rate (APR) is a slightly higher number, intended to reflect more complicated costs associated with the loan above and beyond the note rate. The Federal Truth in Lending law requires lenders to disclose the APR along with the note rate, to protect the consumer from hidden fees.

Related Questions

Thanksgiving questions

*Sadly, we had to bring back ads too. Hopefully more targeted.