What is a fixed rate mortgage?

Mortgage repayments are fixed for the length of the fixed rate deal, regardless of whether the interest rates go up or down in that period.  Therefore, you know the cost will be the same every month to help you budget accordingly.

Generally, the shorter the fixed period you have, the better the interest rate will be. A five year fixed deal will have a higher rate than a two year fixed deal.  This is due to the mortgage lender taking on more risk the longer the term.

However, you will notice in recent years the gap has been closing and five year fixed terms have increased in popularity as borrowers take advantage of the cheaper rates.

It is at the end of this fixed rate term that the mortgage lender will place you on their standard variable rate (SVR) where the rates ate inevitably higher.  This is the time to re-mortgage to a better deal.

Please check out our re-mortgage guide fundugive2 re-mortgage guide

We can simplify the re-mortgage process for you. Our service is completely free and you are under no obligation to commit to anything we find. If we source a deal you like then we will donate 25% of any fees we receive from the lender to a charity of your choice.