Loans are simply borrowed money; lenders provide money to the borrowers to buy things. However, the lender in not giving this money for free in addition the borrowers has to return some extra money in return to the lender called interest just for using their money.
In addition, if the loan is secured interest rates of approval rates the bank or the lender can seize the assets if the borrowers is failed to repay. Interests rates depend on the organizations policy it can be annually or any condition can be applied.
Interest rate comes in three types, fixed and variable, interest rate is not equal to APR and Credit Scores. Fixed interest rates are much secure and reliable whereas the variable interest rates can change over time often quite dramatically.