Legal Definition and Related Resources of Annual Percentage Rate

The annualpercentage rate offinance charge determined in accordance with §226.5. 12 C.F.R. 226.2(e).

Browse or run a search for Annual Percentage Rate in the American Encyclopedia of Law, the Asian Encyclopedia of Law, the European Encyclopedia of Law, the UK Encyclopedia of Law or the Latin American and Spanish Encyclopedia of Law.

Annual Percentage Rate in Historical Law

You might be interested in the historical meaning of this term. Browse or search for Annual Percentage Rate in Historical Law in the Encyclopedia of Law.

Search for legal acronyms and/or abbreviations containing Annual Percentage Rate in the Legal Abbreviations and Acronyms Dictionary.

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Apr in the American legal Encyclopedia

What does Annual percentage rate mean in American Law?

The definition of Annual percentage rate in the law of the United States, as defined by the lexicographer Arthur Leff in his legal dictionary is:

It is possible to quote interest rates in a bewildering variety of ways, e.g., in percent per month, or in percent per year, but applied to a declining balance of outstanding principal (see declining balance loan), or just in dollars of interest per week, or month or year. The Consumer Credit Protection Act provided that substantially all consumer interest rates were to [be] quoted in one form, to be called the “annual percentage rate” (frequently abbreviated “APR”), so that a person shopping for credit might compare the rates offered.

In fact, the actual calculation of an annual percentage rate can be enormously complex in certain circumstances, e.g., when principal is to be paid back at a variable rate. Hence there is a vast body of regulation, most of it impenetrable, dealing with how to calculate the annual percentage rate in various situations. (See Regulation Z.) But for almost all purposes, the annual percentage rate for closed-end credit can be calculated with sufficient accuracy by the following formula:

R =2(P)(C)/A(N + 1)

where:

R is the annual percentage rate

P is the number of payments per year

C is the dollar amount of the finance charge

A is the principal balance, i.e., the amount

Concept of Annual Percentage Rate (a.p.r.) in the context of Real Property

A short definition of Annual Percentage Rate (a.p.r.): The yearly interest percentage of a loan, as expressed by the actual rate of interest paid. For example: 6% add-on interest would be more than 6% simple interest, even though both would say 6%. The A.P.R. is disclosed as a requirement of federal truth in lending statutes.

Concept of Annual Percentage Rate (a.p.r.) in the context of Real Property

A short definition of Annual Percentage Rate (a.p.r.): The yearly interest percentage of a loan, as expressed by the actual rate of interest paid. For example: 6% add-on interest would be more than 6% simple interest, even though both would say 6%. The A.P.R. is disclosed as a requirement of federal truth in lending statutes.

Meaning of Annual Percentage Rate

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