InvestorWords.com

interest

Definitions (3)

1. The fee charged by a lender to a borrower for the use of borrowed money, usually expressed as an annual percentage of the principal; the rate is dependent upon the time value of money, the credit risk of the borrower, and the inflation rate. Here, interest per year divided by principal amount, expressed as a percentage. also called interest rate.

2. The return earned on an investment.

3. Partial or total ownership in an asset.

Featured Tip

Hidden Dangers of Monthly PaymentsFocus on the long-term cost of the loan, not the monthly payment. "Many car dealers or even mortgage lenders will entice borrowers by asking how much they can afford to pay each month," said Janet Kin ... Read more

Additional Tip(s)

How to Avoid High Interest Rates on Credit Cards
Compare Financial Services from Various Financial Institutions
Loans Against Your Home's Equity
Don't Forget About Deprecation Charges
Paying Off Mortgages
5 Reasons to Keep Banking Costs Down
Forex Managed Trading Accounts (Pros and Cons)
A Perspective on the Indian Who Sold Manhattan
Lending Money versus Investing Money

More Tips...

Nearby Terms

Intercontinental Exchange (ICE)
inter-corporate dividends
inter-dealer broker
interdealer quotation system
interdelivery spread
interest
interest accrual period
interest accrual rate
interest arbitrage
interest assumption
interest bearing investment

Popular 'Lending & Credit' Terms

equity
triple net lease
leverage
interest rate
amortization
security
accounts receivable
quick ratio
financial leverage
accounts payable

Related Terms

accrued interest
compound interest
exact interest
ordinary interest
explicit interest
imputed interest
personal interest
prepaid interest
simple interest
with interest

Mentioned in these terms

interest assumption
covered interest rate parity
rate of interest
conflict of interest
zero-bound interest rate
interest sensitive policies
fee simple interest
interest deduction
interest in property
interest rate agreement