APR stands for Annual Percentage Rate. It shows the yearly cost of borrowing money, including interest and certain fees. APR helps you compare the true cost of loans by putting everything into one annual percentage number.
If you borrow $1,000 at 5% APR, you'll pay about $50 in interest over one year (not counting any fees). If another loan offers 6% APR, the second loan costs more per year, making it easier to compare which is cheaper.
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