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It doesn't mean the lender will actually lend you money for a year, but it's the standard for comparing deals. If you pay back your loan in less than a year, you'll pay less than the annual rate in deferred personal loans. I'm not a maths whizz, how can I understand APR. Interest rates. Per cent just means per hundred. So for money 1 is 1p in the pound. 50 is 50p in the pound.