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Prime RateIn North American banking, the prime rate is the interest rate a banks charge to their best or "prime" customers. Each bank will quote a prime lending rate. Many institutions quote prime rates established by large money center commercial banks such as Citibank or Chase Manhattan. There is also a prime rate average listed in the Wall Street Journal that is an average of the largest commercial banks. The rate given to consumers on their credit cards is often based as the prime rate plus a certain percentage, which represents the lender's assessment of the risk in lending, plus its profit margin. |
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Related Mortgage Definitions: Prime Rate Prime Rate In North American banking, the prime rate is the interest rate a banks charge to their best or "prime" customers. Each bank will quote a prime lending rate. Many institutions quote prime rates established by large money center commercial banks such as ... more... Warehouse Fee Warehouse Fee Some mortgage companies borrow money on a short term basis in order to originate loans which are to be sold later in the secondary mortgage market. When the prime rate of interest is higher on short term loans than on mortgage loans, the mortgage firm has an ... more... Loan Origination Fees Loan Origination Fees Charge by a lender or broker connected with originating a loan. Different from discount points which are used to buy down the rate of interest. A point is simply one percent of the total loan amount. Loan origination fee usually varies from 0.5% to 2% ... more... Adjustable Rate Mortgage, ARM Adjustable Rate Mortgage (ARM) Also known as a variable rate mortgage. The interest rate on these mortgages changes periodically. Variable or adjustable loans are loans whose interest rate fluctuates over the period of the ... more... |
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