interest rates that change periodically (e.g. quarterly, annually etc.). The interest rates for federal Stafford and PLUS Loans are set by the government each year and change annually on the first of July.
The rate of interest that changes during the life of a loan on a regular basis and is generally tied to an index. Some student and parent loan programs have variable interest rates that change annually based on the one-year Treasury Bill rate.
With a variable interest loan, the interest rate changes periodically. For example, the interest rate might be pegged to the cost of US Treasury plus additional percentage rate and be updated monthly, quarterly, semi-annually, or annually.