The cost for borrowing a lender’s money
Interest rate takes into account the lender’s risk and how much it costs the lender to get the money for a loan. The more risk the lender takes, the higher the interest rate they charge you. You pay a small portion of the interest that you owe in each monthly loan payment.
The interest rate on a fixed rate loan depends on the going market rate and how many discount points that you payup-front. An adjustable rate loan’s interest rate is made up of the index, which is an economic indicator of overall interestrates, and the lender’s margin.
Interest rate takes into account the lender’s risk and how much it costs the lender to get the money for a loan. The more risk the lender takes, the higher the interest rate they charge you. You pay a small portion of the interest that you owe in each monthly loan payment.
The interest rate on a fixed rate loan depends on the going market rate and how many discount points that you payup-front. An adjustable rate loan’s interest rate is made up of the index, which is an economic indicator of overall interestrates, and the lender’s margin.
