what are variable loan, why do they exist & why would someone consider one?

Question

title. i understand the difference between variable and fixed as definitions however with loans, ‘variable’ doesn’t quite register to me..

why on earth would someone consider that type of loan with a purchase of let’s say, a house?

In: 43

Answer 1

Adjustable rates go off of the purchasing power of the money I stead of the dollar amount. So through changes is the economy and inflation your rate will change.