Prime Rate
/ˈpraɪm reɪt/
Definitions
- (n.) The interest rate that commercial banks charge their most creditworthy customers, often used as a benchmark for other loans.
The loan's interest rate is tied to the prime rate determined by major banks.
Forms
- prime rate
- prime rates
Related terms
See also
Commentary
In legal and financial drafting, specify whether the prime rate referred to is a particular bank's rate or an industry average to avoid ambiguity.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.