Variable-Rate Mortgage
Like an adjustable-rate mortgage, a variable-rate mortgage has a floating interest rate, which varies according to fluctuations in the market.
But unlike an adjustable-rate mortgage, a variable-rate mortgage will always require the same payment amount each month. Your payments will stay the same, no matter what happens to the prime lending rate. What will change, however, is the length of time you will need to pay off the loan. If the prime rate increases, you’ll need more time to pay off the loan. If it decreases, you’ll pay it off sooner.