The Annual Percentage Rate(APR) will be the total cost of borrowing, while normal interest rates are what your monthly loan payments are calculated on. The APR takes into consideration the interest you are going to pay over the entire life of the loan in addition to any extra charges or fees that you will be associated with obtaining that loan. Extra charges like processing fees, foreclosure amount, etc. 

APR is the method to compute the annual cost of the credit that you have taken or will take from your respective banks. An APR provides an accurate estimate using which borrowers can easily compare various interest rates charged by different lenders. As loans and other financial products vary from one organization to another, APR will make it easier to understand how much you will have to pay against their total loan. Most banks decide the APR of a loan based on your credit history, repayment records, credit scores, etc. Before deciding to apply for a particular loan you can calculate the APR by yourself and compare the rates.