Editor's choice: LendingClub personal loans
- Less strict eligibility requirements
- Quick turnaround time
- High Trustpilot rating
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As well as choosing a lender, deciding on your loan term and choosing between secured and unsecured, you also have to decide whether you want your rate to be fixed or variable. These two rate options offer different benefits and drawbacks. The guide below will take you through the differences between fixed and variable interest rates and help you decide which option is right for you.
|Fixed rates||Variable rates|
|Description||Your rate remains the same throughout the specified term.||Your rate may fluctuate throughout the loan term.|
Personal loans come with two types of interest rates: fixed or variable. Fixed interest rates remain the same throughout the specified term, which may be for the entire loan term or for an introductory period. If you opt for a variable rate personal loan, you’ll receive the advertised rate, but this rate may change throughout the loan term depending on interest rate movements in the market.
The right type of interest rate for you will depend on a few different factors. Here are a couple of questions you can ask yourself to help you decide:
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