Compare 3 Year Fixed Rate Mortgages

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About 3 Year Fixed Rate Mortgages

Taking out a three-year fixed-rate mortgage means you won’t need to worry about your mortgage repayments rising for at least three years. Find a three-year fixed-rate mortgage to suit you by selecting the type of borrower you are just above and answering the short questions that follow.

Think carefully about securing debt against your home. Your home may be repossessed if you do not keep up repayments on your mortgage

Information written by Tim Leonard Last updated on 07 March 2022.

What is a 3-year fixed-rate mortgage?

Three-year fixed-rate mortgages allow borrowers to fix their mortgage interest rate, and therefore their monthly repayments, at a certain rate for three years. Your interest rate will not rise during the three-year term, and it will not fall.

Once the three years are up, you’ll be moved to the lender’s standard variable rate (SVR), unless you remortgage to a new deal.

Is a 3-year fixed-rate mortgage right for me?

A three-year fixed-rate mortgage may be an option if you want the security of knowing that your mortgage repayments won’t increase over the medium term. In particular, fixing for three years could be worth exploring if you would struggle financially to meet the higher mortgage repayments you are likely to face if interest rates increased and you didn’t have a fixed-rate mortgage.

How do I find the best 3-year fixed-rate mortgage deals?

Nerdwallet’s whole-of-market mortgage comparison tool can help you find the best three-year fixed-rate mortgage – or any type of mortgage – for your circumstances. In return for answering a few quick and easy questions, you’ll get to see a tailored list of mortgages that might be suitable for you.

It is then down to you to compare the rates, fees, repayments and features of the deals, details of which are on screen for each mortgage that’s been shortlisted for you.

What are the advantages of a 3-year fixed-rate mortgage?

  • Your mortgage repayments are guaranteed not to rise for three years, even if interest rates start to increase.
  • You’ll have peace of mind knowing what your mortgage repayments will cost each month for the next three years.
  • It will be easier to set a budget for your wider finances because you know what your mortgage payments are.

What are the disadvantages of a 3-year fixed-rate mortgage?

  • You won’t benefit from lower mortgage repayments if interest rates fall during your three-year term.
  • Rates on a three-year fixed-rate mortgage may be higher than on a variable rate mortgage to pay for the extra security a fixed rate provides.
  • Unless you've paid off your mortgage or are happy to sit on your lender’s standard variable rate, you’ll need to spend time and money remortgaging to a new deal in three years’ time.
  • You’ll probably have to pay an early repayment charge if you want to leave your fixed rate deal early.

3-Year Fixed-Rate Mortgages FAQs

What is a three-year fixed-rate mortgage?

A three-year fixed-rate mortgage is a mortgage where the rate of interest to be paid is fixed for a term of three years. This means your mortgage repayments are fixed for three years as well.

Where can I compare three-year fixed-rate mortgages?

You can find the best fixed-rate mortgages for your financial circumstances using NerdWallet’s handy mortgage comparison tool. Answer a few questions related to your situation and the type of deal you want to see a list of mortgages that might suit your specific needs.

Can I get a three-year fixed-rate remortgage?

It should be possible to find a three-year fixed-rate remortgage deal, so long as you can satisfy the affordability and credit score requirements of such a deal.

» COMPARE: Remortgage deals

Can I get a three-year fixed-rate mortgage with no fee?

You should be able to find a three-year fixed-rate mortgage with no fees, but should note that they will often have higher rates to counter the lack of charges.

» COMPARE: Fixed rate no fee mortgages

What happens to interest when the term expires?

A lender will automatically move you on to its standard variable rate (SVR) once a fixed-rate term comes to an end. In order to avoid this, and the higher rates that an SVR will typically charge, borrowers will often remortgage to a new deal. This can usually be arranged six months ahead of your existing fixed rate expiring.

Is an SVR more costly than a fixed-rate mortgage?

The interest rate on a variable-rate mortgage Generally, you can expect a lender’s SVR to be higher than the rate you’ve been paying on a fixed-rate mortgage. Because of this, moving to a SVR usually means your monthly repayments will rise too.

How does a fixed-rate mortgage differ from a variable rate mortgage?

The interest rate on a variable rate mortgage has the potential to fluctuate over time, usually in line with movements in the Bank of England base rate. This means your monthly repayments could rise or fall, depending on what happens to interest rates overall.

With a fixed-rate mortgage, this uncertainty is taken away, and you’ll always know how much your repayments will be each month.

» COMPARE: Variable rate mortgages

Can you repay a three-year fixed-rate mortgage early?

It should be possible to repay your fixed-rate mortgage early, although you can expect to pay an early repayment charge if you do. As these charges can be significant, you should always think carefully before doing so.

What are the alternatives to a three-year fixed-rate mortgage?

If you want to fix your mortgage payments but a three-year fixed-rate mortgage doesn’t seem right for you, there are a number of other fixed-rate terms you could consider.

Alternatively, if fixing your rate isn’t so important, a variable rate mortgage might be an option for you to explore.

» MORE: Fixed vs variable rate mortgages

About the author:

Tim draws on 20 years’ experience at Moneyfacts, Virgin Money and Future to pen articles that always put consumers’ interests first. He has particular expertise in mortgages, pensions and savings. Read more

NerdWallet has selected Koodoo to provide you with this information-only online comparison service on a non-advised basis. NerdWallet will receive a share of the commission that Koodoo earns from the lender or from our partnered broker, Fluent Mortgages.

Koodoo is the trading name of Mortgage Power Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 845978), and is a registered company in England and Wales (company registration number 10978680), with a registered address at Scale Space, 58 Wood Lane, London, W12 7RZ

Fluent Mortgages Ltd is authorised and regulated by the Financial Conduct Authority (FRN 458914), and is a registered company in England and Wales (company registration number 10978680), with a registered address at 102 Rivington House, Chorley, New Road, Horwich, Bolton, BL6 5UE