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Interest Rate Ceiling

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Interest rate ceiling

Ceiling
The maximum interest rate that may be charged on a contract or agreement. For example, an adjustable-rate mortgage may have an interest rate ceiling stating that the rate will not go over 9% even if the formula used to calculate the interest rate would have it do so. An interest rate ceiling reduces the risk of the party paying the interest. It is also called an interest rate cap. See also: Interest Rate Floor.

Interest Rate Ceiling

The highest rate possible under an ARM contract; same as “lifetime cap.”

It is often expressed as a specified number of percentage points above the initial interest rate. See Adjustable Rate Mortgage (ARM)/ How the Interest Rate on an ARM Is Determined.



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Price controls, including interest rate ceilings, cannot be justified on economic grounds.
Byline: ONA(ONA) MUSCAT Eoe1/4" The Central Bank of Oman yesterday kept unchanged the interest rate ceiling on personal loans offered by commercial banks at eight per cent.
CII suggestions also include increase in tax refund rates by about five per cent, removal of seven per cent interest rate ceiling on export credit and two per cent interest subsidy.
 
 
 
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