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Why do corporations pay higher interest rates on their loans than the US Government?
Wiki User
∙ 7y ago
Because the risk is higher, therefore the rate of interest paid on bonds (loans) is higher than on U.S. Government securities. U.S. Bonds are the safest investment on the market, as they have never forfeited on their notes. The higher the risk of repayment of any loan, the higher the amount of interest must someone pay to justify the risk.
Wiki User
∙ 7y ago
Wiki User
∙ 13y agoCorporations are less secure than the US government. Corporates may default and go bankrupt, whereas the US government is so massive that it is unlikely to default on their debts all at once. Further, the US government can not just close down; it has to deal with the consequences even if it goes bankrupt.
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Is the interest on used car loans higher than the interest on new car loans?
The interest on used car loans are definitely higher than new car loans.The rate is higher because the car is usually not bought from a car sales house
Why do long term loans have higher interest rates than short term loans?
feel it.
Where can one find information about interest free home loans?
Interest free home loans are available from banks and building societies. You may also find information on interest free loans from your local council or government.
Do you pay more interest on unsecured loans than on secured ones?
Interest rates are typically higher on unsecured loans rather than on secured loans. This is because there is no collateral backing the loan.
How does bankruptcy affect interest rates on loans?
Some lenders may find you a higher risk and thus charge you a higher interest rate.
In what ways are private student loans different from government loans.?
Private student loans usually have higher interest rates and have to be paid in a specific time period. Government loans are more flexible.
Is the interest on used car loans higher than the interest on new car loans?
The interest on used car loans are definitely higher than new car loans.The rate is higher because the car is usually not bought from a car sales house
Can you tell me about private education loans vs. government education loans?
HUGE difference. Federally Guaranteed student loans have very low interest rates and many benefits attached. Private student loans have much higher interest rates and no benefits.
Why do long term loans have higher interest rates than short term loans?
feel it.
What are the conditions of emergency loans?
Some conditions of the emergency loans some banks and corporations give out could be no payments for six months, or lower interest rates.
Will interest go higher for car loans?
No it's not like that the interest would go higher for car loans it all depends on your credit records, but there are many online sources who provide car loans with low interest rates try to contact them and get your problem resolved.
How do you get personal loans from government?
As far as I know, you cannot get personal loans from the government since they only provide business loans, Loans for Home Buyers and Loans for Higher Education. Personal loans
Where can one find information about interest free home loans?
Interest free home loans are available from banks and building societies. You may also find information on interest free loans from your local council or government.
Are private student loans more financially advantageous than student loans through the government?
Student loans through the government are better than private loans due to the fact that the government does not have as high of interest on the loans, and you get a longer time to pay them back.
Do you pay more interest on unsecured loans than on secured ones?
Interest rates are typically higher on unsecured loans rather than on secured loans. This is because there is no collateral backing the loan.
I have poor credit, is it still possible to get personal loans without paying a ton of interest?
Loans, in general, are based on risk. The higher the risk, the higher the interest rate. You'll be able to get a loan, but the rate will be higher than if you had better credit.
How does bankruptcy affect interest rates on loans?
Some lenders may find you a higher risk and thus charge you a higher interest rate.
