---
title: "APR (Annual Percentage Rate) — What It Means | Ondo RE"
canonical: https://www.ondorealestate.com/glossary/apr/
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Mortgage & lending[All terms starting with A](/glossary/#letter-A)

# APR (Annual Percentage Rate)

Also called: annual percentage rate, apr vs rate

The yearly cost of a loan expressed as a percentage, including the interest rate plus most lender fees.

APR bundles the note rate together with most of the lender’s cost of doing the loan (origination, discount points, and certain other charges) and re-expresses the whole thing as a single annual percentage. It exists so two offers with different fee structures can be compared on one number.

APR is almost always higher than the note rate, because the note rate alone ignores fees. The note rate is what actually determines your monthly principal and interest; APR is a comparison tool, not the number your payment is calculated from.

## Why it matters

A lower rate with high fees can carry a higher APR than a slightly higher rate with none. Compare both numbers on the Loan Estimate rather than shopping on rate alone.

## Put a number on it

This term feeds the calculators below.

- [Mortgage Payment CalculatorEstimate monthly mortgage payments with taxes, insurance, and PMI.](/calculators/mortgage-payment/)
- [Refinance Savings CalculatorModel payment changes and break-even timing for a refinance.](/calculators/refinance/)

## Related terms

- [Interest rate (note rate)The percentage charged on your loan balance, the number your principal and interest payment is calculated from.](/glossary/interest-rate/)
- [Discount pointsAn optional upfront fee paid to the lender in exchange for a permanently lower interest rate.](/glossary/discount-points/)
- [Loan EstimateA standardized three-page disclosure showing a loan’s rate, payment, and closing costs in a fixed format.](/glossary/loan-estimate/)
- [Origination feeThe lender’s charge for processing and underwriting the loan, shown in the closing cost section of the Loan Estimate.](/glossary/origination-fee/)

## Go deeper

- [APR vs rate on a Loan Estimate](/blog/apr-vs-rate-on-a-loan-estimate/)

## More in Mortgage & lending

- [Amortization](/glossary/amortization/)
- [ARM (Adjustable-Rate Mortgage)](/glossary/arm/)
- [Cash-out refinance](/glossary/cash-out-refinance/)
- [Closing costs](/glossary/closing-costs/)
- [Conforming loan](/glossary/conforming-loan/)
- [Conventional loan](/glossary/conventional-loan/)

## Have a question about your own situation?

Ondo handles brokerage, lending, property management and notary under one roof, so the answer does not change depending on who you ask.

[Talk to Ondo](/contact/)[Browse all terms](/glossary/)

Loan information is provided by Ondo Real Estate (NMLS ID on file). This is not a commitment to lend, a loan approval, or an offer of credit. Rates, terms, and payments shown are estimates for illustration only, are not a quote, and are subject to credit approval, underwriting, and market conditions. You are not required to use Ondo for financing to buy or sell with Ondo. Equal Housing Lender. Program rules, fees, and county loan limits change. Confirm the current published schedule and lender overlays. Nothing here is a quote, a lock, or a credit decision. [Licensing and disclosures](/licensing/)