Interest rate cap
With an interest rate cap, you can limit your loan’s interest expenses for years ahead.An interest rate cap will help you to keep your loan interest costs under control, even if interest rates rise
You can set a maximum limit for your loan’s reference interest rate for up to 14 years, to secure your finances if interest rates rise.
Interest rate cap sets a maximum for your loan’s reference interest rate but you will also benefit from falling interest rates
With an interest rate cap, you can set a maximum reference interest rate, but you will also benefit from low rates if the reference rate is below the maximum you set.
If you have an interest rate cap, your loan repayment plan can adapt if your situation changes
You can agree on changes to the loan repayment plan and even pay the loan off ahead of schedule. Your interest rate cap will then end, without extra charges.
An interest rate cap will protect you from rising interest rates, bringing peace of mind
You can set an upper limit for your loan’s reference interest rate, which will not be exceeded while the interest rate cap is valid.
You can purchase an interest rate cap for a new or old loan, for the period of your choice: 5, 7, 10 or even 14 years. An interest rate cap is interest rate protection suitable for a home loan or other Euriborbased loans. You can also agree on an interest rate cap for a bank loan.
How does the interest rate cap work in practice?
A maximum reference rate is set for a floating rate loan, for an agreed period. The reference interest rate may change depending on market conditions, but it will not rise above the maximum you set. When the reference rate is lower than the maximum rate you chose, you will still benefit from lower interest rates.
The protection period of the interest rate cap may be shorter than your remaining loan term. When the interest rate cap ends, changes in the reference interest rate will affect the interest expenses of your loan as normal.
How an interest rate cap works based on different repayment methods
An interest rate cap can be set for loans with different repayment methods. The cap sets an upper limit on rises in the reference rate in all cases, but the effect of rate rises on instalments or the loan term varies.
Variable annuity  Equal amortisation  Equal payment  

Instalment


Repayment of loan principal


Loan term


The effect of the interest rate cap when interest rates rise

Limits the growth of interest rates  Limits the growth of interest rates  Limits the extension of the loan term 
Variable annuity
The loan term remains the same. The size of instalment could change even if the loan were protected with an interest rate cap. The benefit of an interest rate cap in this repayment method is that it will help you to keep your interest costs under control. The loan is paid back within the planned schedule. The instalment may also decrease if interest rates fall.
Equal amortisation
The loan term and repayment of the loan principal remain the same. The size of instalment could change even if the loan were protected with an interest rate cap. The benefit of an interest rate cap in this repayment method is that it will help you to keep your interest costs under control. Also, a maximum instalment can be set for the cap’s period of validity. The loan is amortised as planned, and the loan term is not prolonged.
Equal payment
The size of instalment remains the same. The loan term could change even if the loan were protected with an interest rate cap. The benefit of an interest rate cap in this repayment method is that it will help to prevent your loan term getting longer if interest rates rise. The size of instalment remains the same even if interest rates rose, meaning that your monthly costs will stay the same.
We’ll help you to choose interest rate protection that suits you
The protection level and period of the interest rate cap can adapt to your needs. An expert at your bank will help you to choose a suitable interest rate cap, based on criteria such as these:
 The reference interest rate ceiling as a percentage.
 The protection period, which can be 5, 7, 10 or 14 years.
 Will the cap limit the reference rate rise for all of the loan or, for example, just half of it?
 Will you pay the interest rate protection fee in one instalment (premium), or monthly as part of the loan margin during the cap’s period of validity?
Frequently asked questions
The interest rate cap is granted by an OP cooperative bank.