What is the difference between APR and interest rates?

The interest rate is the cost of borrowing the principal loan amount. It can be variable or fixed, but it’s always expressed as a percentage.

The APR is a more comprehensive measure of the cost of your mortgage because it includes the interest rate, as well as other costs associated with the loan, such as broker fees, discount points and some closing costs. A good way of looking at it is that the interest rate specifies what your actual monthly payment will be and the APR calculates the total cost of the loan.