“Interest rate” is the monthly cost you pay on the unpaid balance of your home loan.
“Annual Percentage Rate (APR)” The Annual Percentage Rate (APR) of a loan is actually ‘the cost of borrowing money.’ It includes both your interest rate and any additional costs or prepaid finance charges, including such items as an origination fee, points, private mortgage insurance, underwriting and processing fees. The actual fees on your mortgage may not include all of the items above.
While your interest rate is the rate at which you will make your monthly mortgage payments, the APR is a universal measurement that can assist you in comparing the cost of mortgage loans offered by different mortgage lenders.