I want to get a loan and buy a house. I’ve read plenty of information in banking sites about the interest but i would be grateful if someone could make it clear for me what’s the difference in the fixed and floating interest rate in a 200.000 Euros mortgage loan
In: Economics
A fixed rate means whatever interest rate you agree to at the time you buy is the rate you pay as long as you have that mortgage.
A floating interest rate is one that will go up and down as interest rates in general fluctuate. Here in the U.S. they’re pegged to the Fed’s Prime Rate, over there they may be tied to Libor?
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