APR stands for 'Annual Percentage Rate'. APR is the standard way that banks and other lenders display the total cost of borrowing.
APR takes into account:
- the interest rate
- other charges you have to pay
- how long the agreement lasts
- the amount and timing of the repayments
APR is intended to provide a calculation of how much a loan it will cost over a single year, helping you to compare. Your loan may be shorter or longer than a year, though, so the total amount of interest you will pay is likely to be different from APR.
Our loan calculator will also give you a good idea of this before you decide to apply. After you apply and if you are accepted, your Loan Agreement will clearly display the APR for your loan, as well as the amount repayable each month, and the total cost of your loan (in £).
The point of APR is to make it simple to 'shop around'. By displaying the amount of interest in a standard way, it's easier for you to compare different loan products and different types of borrowing, across different banks and lenders.