24 Hour Loans glossary of financial terms

Annualised Percentage Rate (APR)

The annualised percentage rate (APR) is the interest rate attached to a loan product that tells you the true cost of the loan over the course of a year. Financial regulations state that lenders have to show their annualised percentage rate to consumers so that they can make the right decisions when taking out a loan and so that they fully understand the costs that will be involved.

So, the APRs that you see attached to loan products may not just include the interest rates that will be charged for the loan. They may also include other costs as well ? they basically give an informed snapshot of all the costs associated with any given loan for the full twelve month period. As so many loans give out introductory special offers to the consumers that buy them this means that the consumer has a fair chance of understanding the actual charges rather than simply the introductory offers, for example. APRs, in general, can also make it much easier for consumers to compare all types of loan before they decide which one to take out.