The APR (Annual Percentage Rate) represents the cost of the mortgage as a yearly rate. There are two APRs you need to be aware of. The first is the nominal APR, which is the monthly interest rate multiplied by 12. The second is the effective APR, which takes into account compounding and any fees charged on the loan, including account points, private mortgage insurance, origination fees, etc. The effective APR allows you to more easily compare mortgage loans.