Moneyextra.com Dictionary
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Interest Rate
Interest rate is literally the price you pay for borrowing money. The rate of interest you are charged on a loan will vary according to the level of base rates and if you are taking a repayment loan the length of time over which youre planning to repay the loan.
The interest rate you pay can be calculated in several different ways. The norm in mortgage lending is for interest to be calculated annually as a percentage of the outstanding capital balance.
In a nutshell interest rates on mortgages personal loans savings accounts and credit cards will all in turn usually be linked directly or indirectly to base rates.
The Annual Percentage Rate APR can give a useful guide to the rate youll actually pay.
See Also Loans & Cards Centre and Personal Loans Comparison Service
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2009-02-17 00:00:00 © Moneyextra.com
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