Same as an adjustable-rate mortgage in which interest rates fluctuate with the market and according to a schedule set out in the loan agreement.
A mortgage where payments are fixed, but the interest rate moves in response to trends (it could change from month to month depending on market conditions. If interest rates go up, a larger portion of your payment goes to the interest; if rates go down, more goes to cover the principal.
A mortgage for which the interest rate fluctuates based on changes in the prime rate. If interest rates go down, the monthly principal is reduced; if rates go up, the monthly payments might not cover the interest owing and payments may be increased for the next term. Most variable rate mortgages allow prepayment of any amount (with certain minimums) on any monthly payment date and usually without penalty.