Student Loan Rate: APR 101

Looking at loans' annual percentage rate helps you compare

The APR, or annual percentage rate, is a standardized calculation tool that helps you make realistic comparisons between the borrowing cost of various loans. All other things being equal, you'd generally want the loan with the lowest APR you can get.

Factors when evaluating student loan rates

While the student loan rate and total cost is obviously crucial, remember that other factors are also important in choosing the right lender. They include:

  • Fast and easy application process
  • Length of the repayment period
  • Availability of deferment options
  • Automatic payment options
  • Quality of service, such as online account access

Federal Truth in Lending regulations mandate that lenders include the student loan rate whenever offering loans, making it impossible to hide various costs. Basically, the APR is an annualized expression of all of the costs you will pay on a loan, a combination of both the interest rate and any other costs and fees required by the lender, such as origination fees or closing costs. Because this standardized calculation method is the same for everyone, you generally can be assured that the annual percentage rate provides a good basis upon which to compare the real cost of credit from various lenders. As a borrower, be sure to confirm that when you're comparing loan offers from various lenders, that their student loan rates cover the entire life of the loan.

Learn more about affordable Citizens Bank Student Loan™ rates

Find helpful information about private student loans, to help you make your educational goals come true. Also, learn about our flexible Citizens Bank Student Loan™. If you still have questions about student loan financing, call a student loan specialist at 1-888-411-0266, and we'll help walk you through the process.

Additional student loan and college planning resources

What Should You Ask Your Financial Aid Advisor
Financial Aid 101
What Can I Expect After My Financing is in Place?
Understanding Student Loan Interest Rates
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