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What’s the difference between floating and fixed interest rates?

April 26, 2017difference fixed floating interest rates

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What’s the difference between floating and fixed interest rates?

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Floating Rates: Depending on the movement of interest rates in the market, the interest rate for the loan is reset at the beginning of every quarter, i.e. January 1, April 1, July 1 and October 1. The rate is reset with reference to the ICICI Home Loan Prime Lending Rate prevailing on the dates of the respective resets. When the rates are reset, customers have the option of either adjusting their loan installment or the loan tenure, subject to the overall restrictions on the loan tenure. Fixed Rates: The interest rate is fixed on the home loan for the term of the loan.