Fixed rate loan

A fixed rate loan simply refers to a loan whereby the interest rate is fixed, and therefore does not vary, over the course of the loan period.

Many loans that are familiar to us in our day to day lives and going to the bank are of this sort; for instance standard loans you might take to buy a car for instance will usually be a fixed interest rate loan product.

The attractive element for the borrower is knowing that the rate and size of the payment they need to make will not change therefore helping them to budget effectively.

Related Articles

Certificate of Deposit
Gold standard
Legal rate of interest
Credit Scoring
Delinquency

More Financial Words and Vocabulary Explained