APR stands for Annual Percentage Rate, which represents the total yearly cost of borrowing money, expressed as a percentage of the loan amount. It includes not just the interest rate but also other associated fees — such as loan origination fees, mortgage insurance, or closing costs — making it a more comprehensive measure of borrowing costs. The APR is designed to help borrowers compare loan offers more accurately because it reflects the actual cost of credit over a year. For example, two loans may have the same interest rate, but if one includes additional fees, its APR will be higher. APR applies to a variety of lending products, including credit cards, auto loans, and mortgages. Understanding APR is essential when evaluating financial products, as it allows you to make informed comparisons and avoid hidden costs. It empowers consumers to shop smarter and avoid falling into unnecessarily expensive loan agreements over time.