Finance Glossary

Fixed Rate

An interest rate that stays the same for the full term of the loan, meaning your monthly payments will not change regardless of movements in the Bank of England base rate or market interest rates. Fixed-rate loans offer predictability and budgeting certainty. Most short-term personal loans in the UK are fixed rate.

Example

A fixed-rate loan at 24.9% APR over 24 months means your monthly payment is identical every month — it cannot rise even if the Bank of England raises rates.

Related terms

Variable Rate
An interest rate that can change during the loan term, typic
Interest Rate
The percentage of the loan principal charged by a lender for
Loan Term
The agreed length of time over which a loan must be fully re
Amortisation
The process of gradually paying off a loan through regular s
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