top of page
Image by Kam Idris

Fixed Interest Rates

One of the most popular choices, fixed rate mortgages are a great option if you'd like to know exactly what you'll be paying back monthly for a set period. This type of mortgage allows you to fix your monthly repayments at a set rate for a specified period, meaning your monthly repayments remain the same throughout that period regardless of what happens to interest rates and the base rate. This allows you to budget your monthly expenditure as you do not need to worry about your payments fluctuating should interest rates rise. 

​

There are a range of fixed interest rate mortgages to consider, with the most common terms covering 2, 5 and 10 years. Typically, the longer you fix for the slightly higher your interest rate will be.

2 Year Fixed

Whilst there are some 1 year deals available on the market, they are not normally as competitive as 2 year deals, so typically the shortest deal we will recommend to clients will be the 2 year fixed. Usually, 2 year fixed interest rates tend to be lower than higher period alternatives, so it's a good options if you would like security over your payments but also an opportunity to review on a more regular basis, and ensure you are maximising your chance of being on the best available deals on the market.

​

It is also a sensible option for those who do not have plans to stay in their current property for a longer period of time, as commonly fixed rate deals will have 'early repayment charges' applicable, which in short is a penalty for exiting your fixed period early. These range from 1-2% of the outstanding mortgage balance, or a fixed fee.

3 Year Fixed

Without stating the obvious, it works in the same way the 2 year does, only its fixed for 3 years as opposed to 2 years. It's normally slightly cheaper than its 5 or 10 year comparables, and is a great option if you're torn between a 2 and a 5 year rate. 2 years is appealing as you're able to regularly review, however the security over your payments over a 5 year is equally appealing. So, a 3 year is a good amalgamation of both options.

5 Year Fixed

A 5 year fixed rate is a great option if you'd like peace of mind in knowing what your payments will be for a longer period, and not have to worry about interest rate changes for 5 years. They do tend to be slightly higher than the shorter term rates, however they do offer security for a longer period.

​

It is however worth bearing in mind you will be susceptible to early repayment charges should you wish to move property within that 5 year period, or change interest rate/mortgage type. These vary lender to lender. 

10 Year Fixed

There are a few options on the market which are slightly longer than 10 year, however they are few and far between and are often quite expensive. A 10 year fixed rate is a good option for those who wish to have long term security over their payments, and do not have to worry about interest rate changes over a decade. However, it does limit your flexibility in terms of moving property and switching onto cheaper deals, as going back to what we've mentioned above, early repayment charges will likely apply. You will also be limited as to the size of overpayments you can make.

What Happens Once A Fixed Rate Ends?

Each lender has their own standard variable rate, otherwise know as their SVR. This is their standard variable mortgage rate, and is what you will be moved onto once your fixed rate period comes to an end. You will find that this is usually a few percent higher than what you'd be paying on your fixed rate deal, and any other rates available on the market at the time. This can fluctuate at any time.

​

Once your existing rate is coming to an end, we will look to pre plan ahead and secure a deal a few months in advance, so that once your existing fixed rate ends, we have a new deal in place ready to go immediately, so you avoid incurring higher payments and additional interest on a lender's SVR.

Speak To An Adviser Today!

There is no right or wrong choice, its more so which type and length of mortgage is most applicable to your circumstances. One of our advisers will be able to guide you in finding the best solution to suit your needs and requirements. Contact us today to find out more!

If You'd Like to Discuss Your Options, Contact Us Today!

bottom of page
Trustpilot