Interest rate
The price of borrowing money, or the reward for lending it, expressed as a percentage per year.
Everything about a debt or a savings account reduces to this number. It is the price of the money, and it is the fact worth finding before anything else.
Watch for the period. A rate quoted monthly is not comparable to one quoted annually — “2% a month” is roughly 27% a year once it compounds, not 24%, and certainly not 2%.
Watch also for what the rate is charged on. A rate applied to the full original amount for the whole term costs far more than the same rate applied to a falling balance.
A rate alone does not tell you whether a debt is affordable, only what it costs. Affordability is about the payment; cost is about the rate. Sellers usually answer the first question when you asked the second.
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