Hi
Loopback interfaces are logical interfaces created manually in the devices which has its own significance mainly in routing process.
It always remain in up/up state which u cant except with any of the physical links which are prone to errors/failures which lead them to down state.
If u establish the routing process with the loopback ips which u configure under the loopback itnerfaces u always have the advantage of ur process remain up regardless of any change in link states.
Though the process will compute/recalculate only on the basis of the links which goes down and not the whole process to be restarted again.
In a situation where u got to have 2 physical links and if u r having routing adj with the other end using one of the physical link which is prone to failures will have an impact on ur hardware resources of ur router (which goes onto recomputation/restarting the process afresh again).
Instead u can make use of the loopback id and have the adjacency or ur neighborship established and in this case ur process will remain up though the link goes down.
regds
