Compare Fixed Rate Mortgages

Fixed rate mortgages can be a good option for home buyers who want the safety of knowing that their repayments will remain steady for a period of time. Compare the latest interest rates, fees and other important features of fixed rate mortgages.

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Information written by Tim Leonard Last updated on 12 January 2022.

What is a fixed-rate mortgage?

A fixed-rate mortgage provides a way for you to fix your mortgage rate for a set period of time. This might be for anywhere between one and 40 years, although two-, five- and 10-year fixed-term mortgage deals tend to be the most widely available.

The fixed-rate term you choose is the length of time during which your monthly mortgage repayments will remain unchanged.

» COMPARE: Five-year fixed rate mortgages

What are the benefits of fixed-rate mortgages?

Fixed-rate mortgages offer borrowers security and peace of mind. With a fixed-rate mortgage, you will know exactly how much you’ll be paying for the length of your mortgage deal. This means you can budget accordingly and you will be protected from potential interest rate rises.

What are the downsides to a fixed-rate mortgage?

The biggest downside of a fixed-rate mortgage is that if interest rates were to fall, you would not feel the benefit through a decrease in your mortgage repayments. Traditionally, fixed-rate mortgages have also tended to have slightly higher interest rates than variable rate mortgages. However, to be sure you might want to compare both types of mortgage during your search.

» COMPARE: Variable rate mortgages

Is a fixed-rate mortgage better than a variable rate mortgage?

The answer to this will usually depend on your personal situation and how much risk you’re prepared to take on in relation to interest rates.

A fixed-rate mortgage will usually be preferable if you are risk-averse and want to rule out the possibility of your mortgage payments rising during the fixed-rate period.

Alternatively, a variable rate mortgage may be worth considering if it offers a lower mortgage rate and your finances could comfortably absorb any future rate rise.

» MORE: How fixed- and variable rate mortgages differ

Types of fixed-rate mortgage

Certain fixed-rate mortgages are available offering features designed to cater to different borrower needs.

Fixed-rate no-fee mortgages

As these fixed-rate mortgages have no arrangement fees, they can be an option if you need to keep your initial costs to a minimum. The downside of fixed-rate no-fee mortgages is that they usually have higher interest rates to make up for the lack of upfront charges.

» COMPARE: No fee mortgages

Fixed-rate interest-only mortgage

With a fixed-rate interest-only mortgage, your monthly payments are fixed but will only need to cover the interest that you are charged on your loan each month. While this helps to keep repayments low, you will need a way to repay the actual loan amount at the end of the term, as you’re not paying any capital off as you go. They are also only available on low loan to house value loans.

» COMPARE: Interest-only mortgages

How long can I fix my mortgage rate for?

The majority of fixed-rate mortgages tend to be for either two or five years. However, should you want to fix for longer, there are usually some 10-year fixes available and sometimes the market will offer deals that stretch as long as 15, 20 or 40 years, but these can come and go. Shorter fixes of one, three and four years can also sometimes be available on the mortgage market.

» COMPARE: Two-year fixed-rate mortgages

How do I choose the best fixed-rate mortgage?

NerdWallet’s mortgage comparison tool offers the best way to find a fixed-rate mortgage that is suitable for you.

Simply select the type of borrower you are, and a few short questions later you will be presented with the fixed-rate mortgages most likely to fit your needs. Comparisons are made easy as you’ll immediately be able to see the initial fixed interest rate, APRC and fees for each mortgage, along with an indication of what your monthly repayment might be.

The Annual Percentage Rate of Charge, or APRC, will help you get an idea of the overall cost of the home loan, including the interest rate but also other charges, making it easier to compare mortgage deals.

Fixed Rate Mortgages FAQ

What is a fixed-rate mortgage?

A fixed-rate mortgage allows you to fix your mortgage rate for a set period of time during which you’ll know your monthly payments will always stay the same.

What happens when my fixed-rate mortgage ends?

When a fixed-rate mortgage comes to an end, your rate will no longer be fixed, and you’ll be moved to your lender’s standard variable rate (SVR) instead. As a SVR will almost always have a higher interest rate than your fixed rate, and lenders can amend the rate as they see fit, most borrowers will arrange to remortgage to a new deal ahead of their fixed rate ending. A remortgage can usually be arranged when a fixed rate has six months or less left to run.

» COMPARE: Remortgage deals

Can you leave a fixed-rate mortgage?

Exiting a fixed-rate mortgage early is possible, but you might need to pay an early repayment charge for doing so. Usually, this amounts to a percentage of the mortgage you want to repay. So if you have £200,000 outstanding on your mortgage and the early repayment charge is 5%, you would need to pay £10,000 if you want to end your deal ahead of time. These percentages are often tiered to decrease as you get nearer to the end of the fixed-rate deal.

» MORE: Is remortgaging a good idea?

How does a fixed-rate mortgage work?

A fixed-rate mortgage will have the same rate of interest for a set period of time. So if you opt for a five-year fixed-rate mortgage, your monthly repayments are guaranteed to stay the same for at least the next five years. When the fixed-rate period ends, your mortgage rate reverts to the lender’s standard variable rate, which will almost certainly be higher in comparison. For this reason, borrowers in the last six months of their fixed-rate deal will often arrange to remortgage to stop this from happening.

Is a fixed-rate mortgage right for me?

If you like to know exactly how much your mortgage payments will be each month, then a fixed-rate mortgage may be right for you. It would give you peace of mind that your payments won’t rise, and you would be able to budget accordingly.

Will I pay a higher rate for a fixed-rate mortgage?

Not necessarily. It used to be that fixed-rate mortgages always featured higher rates than variables but that is no longer always the case. It is possible to get a competitively priced fixed rate, which has a competitive interest rate to a variable rate mortgage.

How can I get the lowest fixed-rate mortgage?

The very best fixed-rate mortgage rates tend to be reserved for borrowers with the lowest loan-to-value (LTV) requirements and the most favourable credit scores.

But whatever your circumstances, shopping around using NerdWallet’s mortgage comparison tool can play a huge role in helping find the lowest fixed-rate mortgage to suit your circumstances.

» MORE: What makes a good credit score?

How can I compare fixed-rate mortgages?

When comparing fixed-rate mortgages it is important to remember the rate is not always the most important factor. A product with a low rate may seem like the most cost-effective option but if it comes with a large arrangement fee, it may not be the best choice overall. NerdWallet’s free-to-use comparison tool allows you to sort fixed-rate mortgages by rate, fees and overall cost, helping you to work out the best product for your circumstances.

What happens when I’m nearing the end of my fixed-rate period?

When your fixed-rate period ends, you will move on to your lender’s standard variable rate. You can either choose to stay on this, move to another deal with the same lender or remortgage with another provider. As you approach the end of your fixed-rate period – usually at some point within the final six months of your deal – it is worth comparing mortgages on the market to get an idea of the type of deals available to you.

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

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