Also calculated as a percentage of the overall sales price, APR tell’s the borrower what they’ll be paying for all aspects of the home loan, in addition to interest. Intended to reflect the actual cost of borrowing money, APR is provided to the borrower in their loan estimate when considering lenders. Loan origination fees, private mortgage insurance, closing costs and other charges are all included in the APR estimation, which is provided by the lender when shopping for a loan. On the other hand, interest rate only describes what you’ll be paying in interest every month.