A fixed interest loan (or fixed-rate loan) is a loan where the interest rate stays the same throughout the entire repayment period. If you borrow at 7%, you pay 7% from the first month to the last — no surprises, no changes, regardless of what happens in the market.
The biggest advantage: predictability. Your EMI or monthly payment never changes. If you lock in a 30-year mortgage at 6.5%, your payment stays the same even if rates jump to 10% next year. You can budget with complete certainty.
The downside: if market rates drop significantly, you are stuck paying the higher fixed rate (unless you refinance, which involves fees). Fixed rates are typically 0.5-1% higher than initial variable rates because the bank charges a premium for bearing the interest rate risk. Most US mortgages are fixed-rate; in the UK and many Asian countries, variable rates are more common.