Several definitions of APR can be found online but without digging deep the results can be a little vague.
The APR or Annual Percentage Rate is, according to Wikipedia:
“Annual Percentage Rate (APR) is an expression of the effective interest rate that will be paid on a loan, taking into account one-time fees and standardizing the way the rate is expressed. In other words the APR is the total cost of credit to the consumer expressed as an annual percentage of the amount of credit granted. APR is intended to make it easier to compare lenders and loan options.”
That is just a snippet from Wikipedia where you can find a much more in depth explanation of what it ‘is’ but what does it represent?
A lenders APR is the rate at which two thirds or more of their loans are sold at.
Lenders often offer a range of rates to suit a variety of circumstances. Some people will qualify for their lowest rates while people in less stable situations or with bad credit will only qualify for higher rates.
A lender can reduce their ‘typical apr’ by only accepting applicants that meet strict criteria. This makes their average lending rate lower.
Because some companies help people in a variety of circumstances, including bad credit the average rate at which they lend money will be higher.
This does not mean they are unable to offer low rates and can actually mean they are a more flexible lender.