what is annual percentage rate apr 
annual percentage rate apr refers to the yearly interest generated by a sum that s charged to borrowers or paid to investors apr is expressed as a percentage that represents the actual yearly cost of funds over the term of a loan or income earned on an investment this includes any fees or additional costs associated with the transaction but does not take compounding into account the apr provides consumers with a bottom line number they can compare among lenders credit cards or investment products peopleimages gettyimages