HOW LONG TO
FIX A MORTGAGE FOR

A FIXED RATE MORTGAGE CAN BE GREAT FOR FINANCIAL PLANNING
SET THE PRICE OF YOUR REPAYMENTS FOR 2, 5 OR EVEN 10 YEARS

AVOID VARYING MONTHLY REPAYMENT COSTS WITH A FIXED RATE DEAL

HOW LONG TO<br>FIX A MORTGAGE FOR
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How long to fix mortgage for?

Most mortgage lenders offer fixed rates from 2 years to 10 years and will have various options within those deals.

It can sometimes be confusing to know how long to fix your mortgage for and which deal is best for you. We’ll explain the options and how the different deals can work based on your circumstances or the economy.

Why should you fix your mortgage?

There are many reasons why you would want to fix your mortgage rate such as:

  • Financial stability so you can accurately project your personal finances over a period of time
  • Save money and protect against future interest rate rises, especially during periods of economic instability
  • Less stress and uncertainty by fixing your mortgage rates so you know exactly how much your monthly payments will be
  • Lower interest rates are also often available through fixed mortgage deals compared to discount, tracker, or variable rates

A fixed rate can be an attractive option for many borrowers, whether you are a first time buyer or if you already have an existing mortgage deal.

There are also a number of reasons why you might not want to fix your mortgage rates such as flexibility and potentially lower discount rates.

What is a common fixed rate period?

The most common fixed rate periods are 2 or 3 years which are often the lowest rates and fees. Lenders often offer these at lower rates because they tend to cost less for them to process and they come with less risk.

It is also common for a mortgage borrower to switch to a new mortgage deal every 2 to 5 years to save money, release equity, or for moving home. They may even choose a different type of mortgage at this point, depending on individual circumstances.

Many people are put off fixing their mortgage for longer periods of time because of Early Repayment Charges and penalties. You might also be put off because of the fact that it can mean that you can’t take advantage of lower mortgage rates.

For more information on fixed rate mortgages CLICK HERE.

What is the best fixed rate period?

When you think about how long to fix a mortgage for either when buying a home or remortgaging your property, you should consider your own circumstances.

Some things to think about before you take out fixed rate mortgage:

  • Do you want to move house in the future?
  • Is your income likely to change over the fixed rate period?
  • Will you need to release equity for debt consolidation or home improvements?
  • Are you concerned about interest rates?
  • Do you want stability and security?
  • When are you going to retire?
  • Do you have any investments or inheritance due to pay out?

Sometimes it can be confusing when you think about how long to fix mortgages for and especially when buying a home.

Can you change your fixed rate deal?

When you accept a fixed rate mortgage deal and you start to make your repayments, you are tied in from the start date.

It is highly likely that your fixed rate mortgage will include an Early Repayment Charge or a penalty for settlement. This is the main reason why you should carefully consider your options before you take out a new fixed rate deal.

Often a fixed rate deal won’t give you the option of changing or moving to another type of rate such as a tracker mortgage or variable rate mortgage.

However, if you are coming to the end of a fixed rate term you will automatically switch to your lender’s standard variable rate (SVR).

This could be a higher interest rate than your current payments, so at this point a remortgage to a different fixed rate deal would be a good idea.

About essential MORTGAGES

We have a wealth of expertise in all types of mortgages and have over 20 years experience in matching buyers with great mortgage deals. Our specialist panel has access to over 50 top UK lenders and can compare hundreds of mortgage deals across the market.

Our team can offer expert support throughout the entire mortgage application process. Speak to our team of independent mortgage specialists for help and advice with your property purchase or remortgage deal.

Need help with your fixed rate mortgage?

If you need more information about your fixed rate mortgage deal or advice about a new fixed rate mortgage, call us on 0330 1188188 or CLICK HERE.

Our team of fully qualified mortgage experts will help you to understand how long to fix mortgage for. A specialist mortgage broker or advisor such as those on our team can help you find the perfect deal – at a price to suit any budget.

Useful resources

Statista.com – Average interest rates for mortgages in the United Kingdom

Citizen’s Advice – Managing your mortgage

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