Which type of interest rates remain constant over an agreed period of a loan?

Fixed interest rates are those that remain constant over an agreed period of a loan. This means that the borrower knows exactly how much interest they will pay throughout the life of the loan or for a specific term. The predictability of fixed interest rates allows borrowers to budget effectively, as their repayments will not fluctuate with changes in market interest rates. This stability can be particularly advantageous in economic environments where interest rates may vary significantly, providing the borrower with a sense of security regarding their financial obligations.

In contrast, floating interest rates, variable interest rates, and promotional interest rates typically involve changes based on market conditions or are offered for a limited time, leading to uncertainty in future payments.