Various Uses for the Term "Bank Rate"
The term bank rate is most commonly used by bankers to refer to the Federal Discount Rate of interest charged to Federally Chartered Savings Banks. The term bank rate is commonly used by consumers to refer to the current rate of interest given on a savings certificate of Deposit. The term bank rate is most commonly used by consumers who are interested in either obtaining a purchase money mortgage, or a refinance loan, when referring to the current mortgage rate.
Types of bank interest rates
- Bank rate on a Certificate of Deposit "CD".
- Bank Rate on a credit card or other loan
- Bank Rate on an automobile or real estate loan
used to have a close relation with consumers Bank Rate[current rate of interest]. With an increase in Bankers Bank Rate the Consumers Bank Rate also used to increase. With vast changes in Bank Financial Structure and with less dependency on Central Bank for financing customers credit, the control on Bankers Bank Rate has very less impact on Consumers Bank Rate.
Consumer Use of the Current Bank Rate
Consumers will check the current "Bank Rate" by comparing CD rates in the local newspaper or by visiting website's online, in order to determine which will pay the highest Annual Yield on their savings. Consumers will compare mortgage interest rates by visiting mortgage websites that show the various rates of interest of mortgage companies.
Regional Bank Rate
While influenced heavily by the Federal Reserve Interest rate, all bank rates will vary regionally. It pays to compare interest rates on a regional or state wide level.
The best way to compare various rates of interest offered
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