The loan with floating interest rate - is it profitable?

In recent years, in contrast to consumer loans mortgage banks began to think through very carefully, t. To. Competition for banks on this issue is very high and everyone wants to get rich client.

Many banks have already appeared an interesting method of charging interest on the loan - a floating rate. What is a variable rate, as it is the most important thing is it profitable? Let's take a closer look.

Speaking of the mortgage we mean long-term loans - are loans for 5 - 10 years or more, buying a car, the construction of housing and home repairs, reconstruction of buildings and other needs. In this period of time it is very difficult to predict the economic situation in the country and in the world. What will be the rate of inflation and inflation itself, amount of money massya, exchange rates and more. In this case, when there is no possibility to make good predictions, all its risks, which may take place, commercial banks mortgage to a fixed rate and margin.



A loan with a floating rate - this is the tool that allows you to calmly and confidently to feel not only the banks and the financial institution, but also to borrowers.

After all, banks are interested in increasing the crediting volumes, t. To. It is not particularly interesting and economically advantageous to make a couple of clients. Banks tend to make a hundred and tysichah customers to on borrowed money has enriched the bank, he has enriched and subsequently made a deposit in the bank ihnem. Thus the banks by any means to increase the volume of lending. And it needs to loans are available to all customers.

The essence of the floating rate is the rate that the whole is divided into two parts. The first part - floating, which is the base, and it changes over time and under certain conditions, and the second part is constant margin or premium to the base.