"per year the loan is held" sounds exactly this.
>Since the 5% doesn't change with the amount lent
that is the definition of a '%' sign, isn't it? :)
Using '%' with "per year" is a definition of interest, isn't?
Edit: wow, i just now recognized another possibility - charging 5% x [expected years] upfront - that would be "fee", yes. One fr!cking large fee. Who in sane mind is going to pay it? That sounds like preying on people who have no other choice.
I was not aware of this. You are correct - this looks more like interest than a facilitation fee.
> that is the definition of a '%' sign, isn't it? :)
Transaction fees are usually assessed as a fraction of the value transacted. A flat fee, within this context, is a non-varying percentage of the transaction value, e.g. 5%. A non-flat fee has moving parts, e.g. 5% for the first $100, 4% for the next, etc. (or 5% if the interest rate is less than 15%, 10% if above, etc.).
It is an ambiguous term. I try to avoid it. Instead of calling a fee "flat" to emphasise its simplicity, make it simple.