What is APR?

APR stands for Annual Percentage Rate. It is the cost of borrowing expressed as a yearly rate that includes fees and interest. APR is the standard way of measuring the cost of credit for consumers. It applies to credit cards, mortgages, and other forms of credit. In New York, the Credit Card Accountability Responsibility and Disclosure Act (CARD Act) of 2009 requires that credit card companies disclose their APR. This must be done in an easily understandable format on all statements, offers, and applications. The CARD Act also requires that the APR be presented on an annual basis. This gives consumers a better understanding of the costs associated with borrowing. APR is important to understand because it affects how much a consumer will eventually pay for the item purchased. If a cardholder chooses a card with a higher APR, they will be paying more in the long run. Additionally, if the cardholder is not careful and does not pay off the balance in full each month, they may end up paying more in interest than the cost of the item. For these reasons, it is important to read the details of any credit card agreement and understand the APR before signing up for a card. This will help to ensure that the consumer can make the best decision for their situation.

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