Formal agreement between a credit intermediary and a customer that establishes the terms and conditions under which the intermediary will provide its services in obtaining credit or financial products on behalf of the customer. This agreement defines the responsibilities and rights of both parties involved in the transaction, such as fees or commissions, service deadlines, legal duties, as well as any other pertinent details related to credit intermediation.
A financial process in which an interest rate or financial value is periodically adjusted on the basis of a specific reference index. This reference index can be a market interest rate such as EURIBOR, an inflation rate or any other widely recognised financial indicator. Indexation is often used in loan agreements, particularly mortgage loans.
Financial indicator used as a basis for calculating an interest rate on loan agreements or other financial instruments. This indicator is usually a widely recognised reference index, such as EURIBOR, the inflation rate or another relevant market rate.
Rate calculated on an amount of money lent or invested, which represents the cost of using that capital or compensation for the loan. It is a form of remuneration paid by the debtor to the creditor or earned by the investor who lent the money.
Periodic payment made by a borrower to a lender as part of the repayment of a loan or credit. These payments are usually made monthly, but the frequency can vary depending on the terms of the loan or credit agreement. Each instalment includes part of the principal amount of the loan and part of the associated interest and charges.
In the context of loans, the interest rate determines the additional amount a borrower must pay to the principal amount of the loan over time. In the context of investments, the interest rate represents the return an investor can expect to receive on money invested in financial products such as time deposits, bonds or savings accounts.
Interest rate that is linked to a specific financial index, such as Euribor, the Interbank Reference Rate (IRR) or another similar reference rate. It is used in loans and investments to determine the interest rate applied to a particular financial agreement. The indexed rate is not fixed; instead, it varies according to the fluctuations of the reference index over time. This means that borrowers with index-linked rate loans can see their monthly instalments and the total cost of the loan increase or decrease as the reference index changes.