A fixed rate loan is a type of loan where the interest rate remains the same throughout the entire term of the loan. This means that the monthly payments are predictable and do not change, making it easier for borrowers to budget their finances. Fixed rate loans are commonly used for mortgages, personal loans, and auto loans. Borrowers often choose fixed rate loans for their stability and security. Since the interest rate is locked in, borrowers are protected from fluctuations in the market. This can be particularly beneficial in times of rising interest rates, as it ensures that the cost of borrowing does not increase unexpectedly.