Student Loan Rates – Fixed vs. Variable – discover.com – Variable interest rates are based on either the Prime Index or the London Interbank Offered rate (libor) index. variable interest rates tend to start lower than fixed interest rates, but may increase over the life of the loan. Interest rates will increase or decrease if the index increases or decreases.
What Is APR? Annual Percentage Rate Explained – · Floating or Fixed APRs. Many loans use a fixed APR, which means your interest doesn’t change throughout the life of the loan. You will most often see this in a fixed rate home loan, car loans, or personal loans. With some home loans, you may have an adjustable rate, which means it changes once and then sets at a fixed rate for the duration.