fixed-rate loan

Definition

A loan in which the interest rate does not change during the entire term of the loan. For an individual taking out a loan when rates are low, the fixed rate loan would allow him or her to "lock in" the low rates and not be concerned with fluctuations. On the other hand, if interest rates were historically high at the time of the loan, he or she would benefit from a floating rate loan, because as the prime rate fell to historically normal levels, the rate on the loan would decrease. opposite of adjustable rate.

Use fixed-rate loan in a sentence

I thought there would be a fixed-rate loan, but I was mistaken and there would actually be another kind of loan.

​ Was this Helpful? YES  NO 1 person found this helpful.

The fixed-rate loan was preferred by the financial analyst who wanted to reduce variance and risk in the project's portfolio.

​ Was this Helpful? YES  NO 11 people found this helpful.

With all of the financial responsibilities and juggling that I have to do, having a fixed-rate loan sure has made my life simpler.

​ Was this Helpful? YES  NO 11 people found this helpful.

Show more usage examples...

Related Terms

Browse Definitions by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
fixed-rate certificate of deposit capital investment loan