Annual Percentage Rate (APR): An expression of the relationship of the total finance charge to the total amount to be financed as required under the federal Truth-in-Lending Act. Tables available from any Federal Reserve bank may be used to compute the rate, which must be calculated to the nearest one-eighth of 1 percent. Use of the APR permits a standard expression of credit costs, which facilitates easy comparison of lenders.

 

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Annual Percentage Rate (APR): The yearly interest percentage of a loan, as expressed by the actual rate of interest paid. For example: 6% add-on interest would be much more than 6% simple interest, even though both would . . . View Full Definition

Periodic Interest Rate: The periodic interest rate, sometimes called the nominal rate, is the interest rate a lender charges on the amount you borrow. Lenders are also required to tell you what a loan will actually . . . View Full Definition

Annual Rate Of Return: There are many ways of calculating the annual rate of return. If the rate of return is calculated on a monthly basis, we sometimes multiply this by 12 to express an annual rate of return. Th . . . View Full Definition

Interest Rate: The percentage rate at which interest is charged on a loan or paid on savings etc.