The annual rate of interest charged on any finance agreement or loan. Must be displayed on finance deals.
Annual Percentage Rate (APR) is a term commonly used in the UK to describe the interest rate on car loans or finance agreements. It represents the annual cost of borrowing, including any additional fees or charges, expressed as a percentage of the loan amount.
For UK drivers, APR is an important factor to consider when financing a car purchase. It helps determine the overall cost of the loan and allows drivers to compare different finance options. A lower APR means lower overall borrowing costs, while a higher APR indicates higher costs.
When applying for car finance, lenders in the UK are required to disclose the APR, allowing drivers to make informed decisions. It is crucial to understand that the APR may vary based on factors such as credit history, loan duration, and the type of vehicle being financed.
Drivers should carefully evaluate the APR offered by different lenders to ensure they are getting the best deal. Comparing APRs can help drivers identify the most affordable finance options and potentially save money on their car purchase.