# what is rate vs apr

estimate home equity loan payments calculator rates heloc payment calculator. For a 20 year draw period, this calculator helps determine both your interest-only payments and the impact of choosing to make additional principal payments. For your convenience a tab above lists current local interest rates. You can use these rates to estimate the price of various mortgage loan products.

Interest Rate vs APR (and Prepaid Finance Charges) When you take on a loan, you agree that in exchange for borrowing money that you will compensate your lender for its services. This "compensation" probably brings to mind interest charges, and interest charges are one of the main forms of compensation for lenders.

Interest Rate vs. APR on Credit Cards. For most financial products, APRs and interest rates are different. However, for credit cards, APR and interest rate are often the same thing. credit card companies generally express their interest rates as APRs.

The advertised mortgage rate "X" is 4.50%, but requires that two mortgage points be paid – it also has \$2,000 in additional closing costs, which pushes the APR to 4.838%. Meanwhile, advertised mortgage rate "Y" is offered with no points and just \$1,000 in closing costs, so the APR is 4.836%, just below that of mortgage rate "X."

Here’s an example of how it works: Loan total: \$20,000 APR = 7% Daily interest rate (APR divided by 365) = .07/365 = 0.00019.

· Both APR (annual percentage rate) and apy (annual percentage yield) are commonly used to reflect the interest rate paid on a savings account, loan, money market or certificate of deposit. It’s not immediately clear from their names how the two.

A variable rate can fluctuate up and down over time, in tandem with movements in the index rate that it’s tied to. A fixed APR, by comparison, would stay the same for the entire length of the repayment term, allowing for predictability in your monthly payments and the total amount of interest paid.