When it comes to loans, it’s important to realize that interest rate and Annual Percentage Rate (APR) are not the same. How are they different?
What is Annual Percentage Rate or APR?
Annual Percentage Rate, or APR, is a way of measuring the full cost a lender charges per year for funds. APR combines the total amount of interest payable and the cost of other fees and charges, averages them over the term of the loan, and expresses them as a percentage.
It is important for a customer to understand how their closing costs are broken down to their cash to close. The APR expressed as a percentage makes it easier for a customer to analyze their options.
We at Traditions Mortgage feel that it is extremely important to provide you with realistic and accurate quotes when you are shopping for your dream home. We are committed to giving you estimations that you can depend on to avoid any potential surprises throughout the process for everyone involved in the transaction.
If you or anyone that you know is shopping for a mortgage, please give us a call or contact a member of our mortgage team online so we can competitively earn your business.