Buyers are often confused about the difference between the Interest Rate and the Annual Percentage Rate (APR).
The interest rate is a percentage of the principal loan amount, and reflects the base cost of borrowing the money.
The Annual Percentage Rate (APR) takes the base interest rate and adds to it the additional costs to get the loan.
What are these additional costs?
And, why is it important and useful for the buyer to know and understand the APR?