The annual percentage rate (APR) is what you’ll pay to borrow money. It includes not only your interest rate but any fees charged by the lender — such as origination fees.
There are two types of APR you’ll likely come across:
A fixed APR stays the same throughout the life of the loan. This means your monthly payment and payoff date won’t ever change.
A variable APR can fluctuate according to market trends. While a variable APR often starts out lower than a fixed APR, it could increase in the future — which would also cause your monthly payments to rise.
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