Basically, interest is the price paid for borrowing money, or the cost charged for lending money. Interest is most often shown as an annual percentage of the amount of the loan. This percentage is known as the INTEREST RATE.
FIXED INTEREST RATE:
A fixed interest rate is unchanging over the term of the loan.
VARIABLE INTEREST RATE:
A variable interest rate fluctuates over the term of the loan based on the Prime Rate.