Capped Rate

What is a Capped Rate?

A Capped Rate is an interest rate that cannot exceed a specified limit, irrespective of any fluctuations in the base rate, for a specified period. This is commonly found in connection with mortgages where many of the products available offer variable rates. By setting a maximum interest rate, the borrower gets some idea of the maximum amount they could potentially end up paying in interest.

A loan may have an overall cap for the life that you have the loan (called a lifetime cap) or an annual cap that limits the maximum amount you can be expected to repay that year.

Jargon Buster

Use the links below and the resulting list of terms on the right to locate the term you are looking for. If you can't locate it, please get in touch.

A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z
keyboard_arrow_left

keyboard_arrow_right

We have loads of great customer reviews