Because it bundles these extra costs, the APR is almost always higher than the base interest rate. This makes it the most "honest" number to use when comparing loan offers from different banks or dealerships. How APR Impacts Total Cost
Any interest that accumulates between the closing of the loan and your first payment. what does apr mean when buying a car
Lenders determine your APR based on several risk factors. The most significant is your ; buyers with "prime" credit (usually 720 or above) qualify for the lowest rates, while "subprime" buyers may face double-digit APRs. Other factors include the loan term (longer loans often have higher rates), the down payment size, and whether the vehicle is new or used (new cars generally have lower APRs). Conclusion Because it bundles these extra costs, the APR