Taking out a loan is an old concept. The are stories in the Bible where people condemn lenders for charging outrageous interest fees. Unlike normal deals and bartering, loans are unique in that the lenders don't get their pay right away. They give something without receiving anything in return, but with the understanding that they'll get more later than what they give now.
It's easy to see how an entire industry has sprung up around the concept of loaning money. Customers can buy whatever they need and the business makes money in the form of interest payments over time. The interest functions as an incentive to repay, too; the longer borrowers don't pay, the more money they owe, which means people can rack up debt if they aren't careful. They might also incur debt with high interest rates that prevent them from paying off the loan quickly.
There isn't a fixed rate. Lenders charge what they like, and the basic economic rules of supply and demand dictate whether or not they get patronized. Still, the whole idea of taking out a loan can be intimidating, and sometimes people don't shop around enough and settle for a bad deal (a higher interest rate). That's where refinance enters the picture.
If people take out a loan and then find a place that offers a better rate, they can refinance their original loan. Essentially, they take out a loan from the business with the better rate, then use the borrowed money to pay off the more expensive business. They move their debt from one company to another, and then pay less interest. In the age of the Internet, it's easy to do comparisons on everything from balance transfers in California to Virginia refinance rates on home mortgages. Take the time to look because it will save you money.