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What is the difference between APR and the interest rate?

April 26, 2017Apr difference Interest rate

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What is the difference between APR and the interest rate?

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APR – the Annual Percentage Rate will be outlined on your Truth In Lending disclosure – also known as the TIL that you receive after your application. The APR is often higher than the quoted interest rate, or note rate. The APR is different than your note rate, or the rate that you were quoted, because the APR includes, in addition to interest, some of the additional costs of obtaining your financing. This is a common practice in mortgage lending. Simply stated, if there were no costs in obtaining financing, your note rate and the APR would be the same.