Types of Interest Rates in Canada

Fixed Rate of Interest: According to the Bank who decided further Fixed Interest Rate according to the debt taken by you. Generally, the interest rate has been decided at the time you sign an agreement and after that, there is no increment in the interest rate.

Simple Interest: The Simple Interest will be calculated on your Principal amount and also it will depend on which interest rate you have signed in the agreement. There are no additional rates included.

Variable Rate of Interest: It will depend on the condition of the market. If you borrow any from the Bank norms, then it is observed that the rates are directly proportional to the fluctuation in the market condition. This is highly recommended for those individuals who are willing to risk according to the market condition.

Compound Interest: In compound interest, your previous interest will be added to your principal amount, and then a new interest will be applied to the remaining amount and it keeps changing.

If a lender finds the borrower for example to be low risk then the borrower may be given that or perhaps even a lower interest rate. Alternatively, if the borrower has worse credit, jumps around jobs a lot, is leveraged higher or so forth he or she will be offered higher interest rates accordingly, or possibly denied altogether.