Home lenders generally offer adjustable rate mortgages. Business lenders (those who loan to flippers or rental income investors) usually offer variable rate mortgage loans.
An adjustable rate mortgage (ARM) changes interest rates only on certain anniversary dates, such as once every six months or once per year.
Variable rate loans change interest rates every time the index changes. If your variable rate loan is based on something called the 11th District Cost of Funds Index, then every single time that rate changes, your loan interest will also change.
That means your payments could be different amounts every month. Many times, variable rate loans have a floor, which means your interest rate may not decrease below a certain percentage, even if the index rate drops dramatically.