Fixed or variable rate

Interest is the "price" lenders charge when you borrow money. It is calculated as a percentage of the outstanding principal.

There are no restrictions on the interest rate, which will depend on the rate set in the loan agreement, and it may be fixed or variable.

  • Fixed rate: the interest rate remains unchanged for the entire duration of the loan, so the borrower always knows exactly how much they have to payInterest on fixed-rate loans tends to be higher than on variable-rate loans.
  • Variable rate: the rate changes over the duration of the loan depending on fluctuations in the benchmark rate applied. Variable rates are usually calculated using the benchmark rate plus a constant percentage (spread).

Before deciding on the suitability of an offer, we recommend that you compare the loan conditions of several offers. Pay particular attention to the benchmark rate and spread applied when comparing variable-rate loans.

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