When it comes to instant cash advance loans online what exactly is the APR?
The APR is the interest rate and any other charges expressed as an annual interest rate charge. The use of an APR is a useful way of comparing instant online loans that are alike i.e. paid back over a longer period of time. But when you are comparing products which are miles apart such like payday loans with only one repayment or any other loan type that is repaid over numerous monthly repayments.
See the details below which should make it easier for you to understand this;
With a personal loan for £500 which has an APR of 19.9% taken out for 36 months will cost a total of £653 to repay; this equates to 31% being added to the cost of the loan in interest charges.
If you were to take out the exact same loan but this time for 60 months it would cost a total £766 to repay the loan; this equates to an interest charge or 53% of the loan amount.
Yet if you were to take out a payday loan for the same amount it would only cost you £625 to repay at an APR of 1737%; this equates to 25% being added in the way of interest.
As you can see from the examples detailed above the APR for the two multiple repayment loans are exactly the same, yet the amount repaid and the actual interest charged expressed as a percentage of the amount borrowed is significantly different. They both also cost much more than a payday loan yet the APR indicates a totally different story.
So if you need a small amount of cash to overcome a short-term financial issue ignore the APR and look at what the loan will actually cost you. You will then see that a instant cash loan is in fact a very competitive option indeed.