Definition
The total annual cost of a mortgage expressed as a percentage, including the interest rate plus lender fees, points, mortgage insurance, and other charges. APR is always higher than the interest rate and provides a more accurate comparison between loan offers. Federal law (TILA) requires lenders to disclose APR.
Related Mortgage Terms
- Closing Costs
Fees and expenses paid at the finalization of a real estate transaction, typical...
- Discount Points
Prepaid interest paid at closing to lower the mortgage interest rate. One point ...
- Interest Rate
The cost of borrowing money, expressed as a percentage of the loan amount charge...
- Amortization
The process of paying off a mortgage through regular monthly payments of princip...
- Appraisal
A professional assessment of a property's market value conducted by a licensed a...
Understanding mortgage terminology helps you compare loan offers and make informed decisions. Use our mortgage calculator to see how these terms affect your monthly payment.