Kamatlábplafonokat

Kamatlábplafonokat, often translated as interest rate caps, are financial instruments used to protect borrowers from rising interest rates. They are a type of derivative contract, typically a swap, where one party agrees to pay a fixed rate of interest while the other party pays a floating rate. In the case of a kamatlábplafon, the floating rate payer is protected against rates exceeding a predetermined ceiling, known as the strike rate. If the floating rate rises above the strike rate, the floating rate payer receives a payment from the fixed rate payer to offset the excess interest cost. Conversely, if the floating rate stays below the strike rate, no payments are exchanged beyond the agreed-upon fixed and floating rates.

These instruments are commonly used by businesses and individuals who have taken out loans with variable interest rates, such as mortgages or business loans. By entering into a kamatlábplafon agreement, borrowers can convert their uncertain floating rate payments into predictable fixed payments once the strike rate is breached. This provides budget certainty and reduces financial risk. The cost of a kamatlábplafon is typically a premium paid upfront or periodically, which reflects the likelihood and magnitude of future interest rate increases. The strike rate and the term of the cap are key determinants of its price. Lenders may also use interest rate caps to hedge their own exposure to falling interest rates.