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Simple English definitions for legal terms
legal rate
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A quick definition of legal rate:
Legal rate: The legal rate refers to the interest rate that is allowed by law. It is the maximum amount of interest that can be charged on a loan or debt. This rate is set by the government and varies depending on the country or state. It is important to know the legal rate when borrowing or lending money to ensure that you are not charged more than what is allowed by law.
A more thorough explanation:
The legal rate refers to the interest rate that is allowed by law. It is also known as the interest rate.
For example, if the legal rate is 10%, then any loan or credit agreement cannot charge an interest rate higher than 10%. If a lender charges a higher interest rate, it is considered illegal and can result in legal consequences.
The legal rate is set by the government or regulatory agency to protect consumers from being charged excessive interest rates. It ensures that lenders cannot take advantage of borrowers by charging unreasonable interest rates.