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How Are ABN LeverageLine Interest Rates Determined?

sbloc rates

What is an interest rate?

According to Investopedia, an interest rate is the amount a lender charges a borrower and is a percentage of the principal—the amount loaned. How are interest rates applied?

Interest rates apply to most lending or borrowing transactions. Individuals borrow money to purchase homes, fund projects, launch or fund businesses, or pay for college tuition. Businesses take out loans to fund capital projects and expand their operations by purchasing fixed and long-term assets such as land, buildings, and machinery. Borrowed money is repaid either in a lump sum by a pre-determined date or in periodic installments.

How are LeverageLine’s interest rates calculated?

All standard (default) LeverageLine interest rates are variable rates, based on a discounted “house” rate (an institution-determined figure based on various indicators) that is keyed to the size of the credit line offer; to this is added a small increment based on 30-day (monthly) LIBOR. (See the 30-day LIBOR rate on any of the major financial sites, including Bloomberg or Bankrate;  the rates have remained within a relatively small range of variance over the last seven years.)

You may also opt for fixed rate financing if you wish. Remember, you can always convert your variable rate to fixed rate if you wish, at no cost.

For questions, feel free to contact us here.

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