Loan fees and APRWhen comparing loans, it’s important to understand how annual percentage rates (APR’s) work. Your loan’s APR is an expression of your loan’s interest rates and fees as a percentage. It’s the easiest way to tell how much your loan will cost you over time — the lower the APR, the less expensive it’ll be. With no-fee loans, your APR and interest rate are the same. With loans that charge fees, your loan’s interest rate is usually lower than its APR.
So, why does this matter? A loan with no fees but a high interest rate will cost you more than a loan with fees but a low overall APR. You might not want to limit yourself to no-fee personal loans if you’re committed to finding the best deal out there.