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Published 13 June 2024
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Best Mortgage Rates UK June 2024

Mortgage rates and deals in the UK are constantly changing. That’s why it’s important to keep track of current mortgage rates and compare mortgages before getting a new deal. Whether you’re a first-time buyer, moving home or remortgaging, NerdWallet can help you compare the latest mortgage interest rates and find the best mortgage deal for you.

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The mortgage rate you pay is key to keeping your mortgage costs lower. It’s also why you should shop around if you’re looking for a new mortgage deal. Whether you’re ready to compare mortgages right now or want to keep tabs on the latest mortgage rates in the UK, everything you need is here. 

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Compare Mortgage Rates

Tell us what you’re looking for and see current UK mortgages available, including rates, repayments and product information. Continue online to our partner L&C for fee-free mortgage help and advice.

Loan Type

Showing 10 of 50 results

Lender Name Initial Rate Monthly Repayments Product Fees Annual Cost

First Direct
4.78% initial rate
Fixed for 5 years
then 6.99% (variable)

Max LTV 90%
£1,286.65
Monthly Repayments
£490.00
Product Fees
6.26% APRC
£15,537.80
Annual Cost
6.26% APRC Max LTV 90%
Fees and Charges
Booking fee £490
Arrangement fee £0
Other fees £0
Valuation fee £0
Cashback £ 0
Flexibility & Other info
Overpayments allowed? Unlimited
Early Repayment Charge 3% reducing to 2% for 5 years
Exit fee £0
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £490 Overpayments allowed? Unlimited
Arrangement fee £0 Early Repayment Charge 3% reducing to 2% for 5 years
Other fees £ 0 Exit fee £0
Valuation fee £0 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.78% and then on a variable rate of 6.99% for the remaining 20 years would require 60 payments of £1,286 and 240 payments of £1,538. The total amount payable would be £446,770 made up of the loan amount plus interest (£221,280) and fees (£490). The overall cost for comparison is 6.3% APRC representative.

First Direct
4.88% initial rate
Fixed for 5 years
then 6.99% (variable)

Max LTV 90%
£1,299.64
Monthly Repayments
£0.00
Product Fees
6.28% APRC
£15,595.68
Annual Cost
6.28% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £0
Other fees £0
Valuation fee £0
Cashback £ 0
Flexibility & Other info
Overpayments allowed? Unlimited
Early Repayment Charge 3% reducing to 2% for 5 years
Exit fee £0
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? Unlimited
Arrangement fee £0 Early Repayment Charge 3% reducing to 2% for 5 years
Other fees £ 0 Exit fee £0
Valuation fee £0 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.88% and then on a variable rate of 6.99% for the remaining 20 years would require 60 payments of £1,299 and 240 payments of £1,541. The total amount payable would be £447,780 made up of the loan amount plus interest (£222,780) and fees (£0). The overall cost for comparison is 6.3% APRC representative.

Cumberland
4.88% initial rate
Fixed to 01/08/29
then 8.24% (variable)

Max LTV 90%
£1,299.64
Monthly Repayments
£999.00
Product Fees
7.15% APRC
£15,795.48
Annual Cost
7.15% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £999
Other fees £0
Valuation fee £0
Cashback £ 0
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 5% reducing to 1% until 01/08/29
Exit fee £125
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £999 Early Repayment Charge 5% reducing to 1% until 01/08/29
Other fees £ 0 Exit fee £125
Valuation fee £0 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.88% and then on a variable rate of 8.24% for the remaining 20 years would require 60 payments of £1,299 and 240 payments of £1,693. The total amount payable would be £485,259 made up of the loan amount plus interest (£259,260) and fees (£999). The overall cost for comparison is 7.2% APRC representative.

Nationwide
4.89% initial rate
Fixed for 5 years
then 7.99% (variable)

Max LTV 90%
£1,300.95
Monthly Repayments
£999.00
Product Fees
6.98% APRC
£15,811.20
Annual Cost
6.98% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £999
Other fees £0
Valuation fee £0
Cashback £ 0
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 5% reducing to 2% for 5 years
Exit fee £65
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £999 Early Repayment Charge 5% reducing to 2% for 5 years
Other fees £ 0 Exit fee £65
Valuation fee £0 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.89% and then on a variable rate of 7.99% for the remaining 20 years would require 60 payments of £1,300 and 240 payments of £1,662. The total amount payable would be £477,879 made up of the loan amount plus interest (£251,880) and fees (£999). The overall cost for comparison is 7.0% APRC representative.

Nationwide
4.90% initial rate
Fixed for 5 years
then 7.99% (variable)

Max LTV 90%
£1,302.25
Monthly Repayments
£999.00
Product Fees
6.99% APRC
£15,726.80
Annual Cost
6.99% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £999
Other fees £0
Valuation fee £0
Cashback £ 500
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 5% reducing to 2% for 5 years
Exit fee £65
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £999 Early Repayment Charge 5% reducing to 2% for 5 years
Other fees £ 0 Exit fee £65
Valuation fee £0 Basic legals Payable
Cashback £ 500
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.90% and then on a variable rate of 7.99% for the remaining 20 years would require 60 payments of £1,302 and 240 payments of £1,663. The total amount payable would be £477,739 made up of the loan amount plus interest (£252,240) and fees (£499). The overall cost for comparison is 7.0% APRC representative.

Clydesdale
4.90% initial rate
Fixed to 31/08/29
then 9.49% (variable)

Max LTV 90%
£1,302.25
Monthly Repayments
£1,680.00
Product Fees
8.02% APRC
£15,963.00
Annual Cost
8.02% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £1499
Other fees £0
Valuation fee £181
Cashback £ 0
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 5% reducing to 2% until 31/08/29
Exit fee £99
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £1499 Early Repayment Charge 5% reducing to 2% until 31/08/29
Other fees £ 0 Exit fee £99
Valuation fee £181 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.90% and then on a variable rate of 9.49% for the remaining 20 years would require 60 payments of £1,302 and 240 payments of £1,853. The total amount payable would be £524,520 made up of the loan amount plus interest (£297,840) and fees (£1,680). The overall cost for comparison is 8.0% APRC representative.

Barclays
4.90% initial rate
Fixed to 30/09/29
then 8.74% (variable)

Max LTV 90%
£1,302.25
Monthly Repayments
£999.00
Product Fees
7.49% APRC
£15,826.80
Annual Cost
7.49% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £999
Other fees £0
Valuation fee £0
Cashback £ 0
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 4% until 30/09/29
Exit fee £80
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £999 Early Repayment Charge 4% until 30/09/29
Other fees £ 0 Exit fee £80
Valuation fee £0 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.90% and then on a variable rate of 8.74% for the remaining 20 years would require 60 payments of £1,302 and 240 payments of £1,757. The total amount payable would be £500,799 made up of the loan amount plus interest (£274,800) and fees (£999). The overall cost for comparison is 7.5% APRC representative.

Lloyds
4.92% initial rate
Fixed to 31/08/29
then 8.74% (variable)

Max LTV 90%
£1,304.86
Monthly Repayments
£999.00
Product Fees
7.5% APRC
£15,858.12
Annual Cost
7.5% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £999
Other fees £0
Valuation fee £0
Cashback £ 0
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 5% reducing to 1% to 31/08/29
Exit fee £0
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £999 Early Repayment Charge 5% reducing to 1% to 31/08/29
Other fees £ 0 Exit fee £0
Valuation fee £0 Basic legals Payable
Cashback £ 0
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.92% and then on a variable rate of 8.74% for the remaining 20 years would require 60 payments of £1,304 and 240 payments of £1,757. The total amount payable would be £500,919 made up of the loan amount plus interest (£274,920) and fees (£999). The overall cost for comparison is 7.5% APRC representative.

HSBC
4.93% initial rate
Fixed to 31/07/29
then 6.99% (variable)

Max LTV 90%
£1,306.17
Monthly Repayments
£999.00
Product Fees
6.33% APRC
£15,773.84
Annual Cost
6.33% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £999
Other fees £0
Valuation fee £0
Cashback £ 500
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 5% reducing to 1% until 31/07/29
Exit fee £0
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £999 Early Repayment Charge 5% reducing to 1% until 31/07/29
Other fees £ 0 Exit fee £0
Valuation fee £0 Basic legals Payable
Cashback £ 500
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.93% and then on a variable rate of 6.99% for the remaining 20 years would require 60 payments of £1,306 and 240 payments of £1,542. The total amount payable would be £448,939 made up of the loan amount plus interest (£223,440) and fees (£499). The overall cost for comparison is 6.3% APRC representative.

Virgin Money
4.96% initial rate
Fixed to 01/08/29
then 9.49% (variable)

Max LTV 90%
£1,310.09
Monthly Repayments
£1,209.00
Product Fees
8.04% APRC
£15,902.88
Annual Cost
8.04% APRC Max LTV 90%
Fees and Charges
Booking fee £0
Arrangement fee £995
Other fees £0
Valuation fee £214
Cashback £ 300
Flexibility & Other info
Overpayments allowed? 10% p/a
Early Repayment Charge 3.5% until 01/08/29
Exit fee £99
Basic legals Payable
Fees and Charges   Flexibility & Other info
Booking fee £0 Overpayments allowed? 10% p/a
Arrangement fee £995 Early Repayment Charge 3.5% until 01/08/29
Other fees £ 0 Exit fee £99
Valuation fee £214 Basic legals Payable
Cashback £ 300
Representative example A mortgage of £225,000 payable over 25 years, initially on a fixed rate for 5 years at 4.96% and then on a variable rate of 9.49% for the remaining 20 years would require 60 payments of £1,310 and 240 payments of £1,855. The total amount payable would be £524,709 made up of the loan amount plus interest (£298,800) and fees (£909). The overall cost for comparison is 8.0% APRC representative.

Think carefully before securing other debts against your home.  You home may be repossessed if you do not keep up repayments on a loan or any other debt secured on it.

Important Information:
This mortgage product comparison service is provided by L&C Mortgages. Information is updated up to twice daily from L&C’s whole of market mortgage database, however some products may be excluded such as those only available directly with a lender or specialist products. Products are initially shown in order of initial rate but can be reordered. By selecting to Continue Online you will introduced to L&C Mortgages and their qualified advisors a Nerdwallet brings you this mortgage rate comparison as a guide. Information does not constitute advice or recommendation. Rates should be considered with all fee’s and charges. Mortgage suitability is specific to your own personal and financial circumstances.

Need Advice?

NerdWallet has partnered with L&C, the UK's leading fee free mortgage broker, to offer you expert advice

Call L&C on:
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On this page

How to get the best mortgage rates and deals

Mortgage rates vary depending on the type of mortgage you’re looking for, your financial situation and your credit score. But when we talk about getting the best mortgage rate, it’s important to find the best rate among the mortgage deals that suit you and your circumstances. 

Mortgage fees and the features you want in a mortgage should always be considered alongside the mortgage rate when making mortgage comparisons and shopping around for any mortgage deal. 

If you’re in any way unsure or want help finding the best mortgage deal for you we recommend you seek mortgage advice.  

Are mortgage rates going down?

Mortgage rates edged higher on certain deals in the past week. Among the big UK lenders, Halifax, TSB and Clydesdale Bank each increased the rates on selected mortgage deals, while Barclays, NatWest and Skipton Building Society raised some rates but lowered others. Santander went against the wider upward trend by cutting certain rates, without raising others. 

Overall, it means the average cost of two-year fixed-rate mortgages increased for the second week in a row, rising to 5.44%, from 5.42%. The average cost of five-year fixed-rate deals held steady at 5.04%. 

In terms of the best mortgage rates available, the lowest two-year fixed mortgage rate on offer is 4.75%, as has been the case since mid-May. However, the lowest five-year rate is now 4.28%, down from 4.34% a week ago. The mortgage rate data is reported weekly by Rightmove. 

There is general uncertainty over what may happen to mortgage rates next. The Bank of England base rate remains at 5.25%, unchanged since last August. Following higher-than-expected inflation in April, market expectations as to when the rate may start to fall were pushed back. Investors now believe it could be August, or more likely September, before the first cut is made. The next base rate announcement is on 20 June, the day after the next set of inflation data is published.

What are current UK mortgage rates? 

The average rate of a two-year fixed-rate mortgage with a 15% deposit or equity, increased to 5.44% over the past week, up from 5.42%, while on a similar five-year fixed-rate mortgage the average rate edged higher to 5.03% from 5.02%. If you have a larger deposit or equity of 40%, the average two-year fixed rate remained unchanged at 4.89%, while the average five-year rate held steady at 4.48%. All rates are according to Rightmove as at 13 June 2024.

Latest average two-year fixed-rate mortgage rates

Loan to value (LTV)6 June 202413 June 2024Week-on-week change⇩ ⇧ 
60% LTV4.89%4.89%No change 
75% LTV5.30%5.30%No change
85% LTV5.42%5.44%+0.02% 
90% LTV5.63%5.66%+0.03% 
95% LTV6.08%6.08%No change

Latest average five-year fixed-rate mortgage rates

Loan to value (LTV)6 June 202413 June 2024Week-on-week change⇩ ⇧
60% LTV4.48%4.48%No change 
75% LTV4.91%4.91%No change 
85% LTV5.02%5.03%+0.01% 
90% LTV5.18%5.19%+0.01% 
95% LTV5.68%5.68%No change 

Data sourced from Rightmove/Podium. Correct as at 13 June 2024.

Average rates are based on 95% of the mortgage market and products with a fee of around £999.

What mortgage do I need?

If you’re looking for a mortgage, you’ll usually fall into one of the following categories of mortgage borrower.

First-time buyer

If you’ve never owned a home before, you’ll usually need a first-time buyer mortgage. Knowing that you’re just starting out, the deposit requirements on most first-time buyer mortgages are generally small. You should also be able to find mortgage deals where upfront fees are kept to a minimum. However, mortgage rates for first-time buyers tend to be higher than if you’re already on the property ladder. This is because you’re likely to require a larger loan relative to the value of your property – so borrow at a higher loan-to-value (LTV) – making you a riskier proposition in the eyes of lenders. As it’s your first mortgage, lenders also have less to go on when trying to assess your reliability as a mortgage borrower.

remortgage

If you already have a mortgage but want to switch to a new one, you are looking to remortgage. You may want to remortgage because your current fixed-rate or discounted term is at an end and you don’t want to move on to your lender’s standard variable rate (SVR), which may be higher. Other reasons may include remortgaging to pay for home improvements, or because falling interest rates or a rise in the value of your home means remortgaging could save you money. If you’ve built equity in your property since taking out your current mortgage, it may be possible to borrow at a lower LTV for your new mortgage – and the lower your LTV, the lower mortgage rates tend to be. In certain circumstances, you may want to remortgage to consolidate debt, although it isn’t a decision to be taken lightly.

» MORE: Compare remortgage deals

home mover

If you already have a mortgage but are moving home, you may be able to take your current mortgage with you – this is called porting. Alternatively, you may want to arrange a new mortgage altogether, either with your current lender or a different one. Whichever option you’re considering, it’s important to weigh up the costs of either porting or exiting your existing deal, along with any potential fees you may need to pay on a new mortgage deal.

buy to let

If you’re buying a property to rent out to tenants, you’ll be looking for a buy-to-let mortgage. You’ll normally need a larger deposit for a buy-to-let mortgage than you would for a residential mortgage, and buy-to-let mortgage rates tend to be higher too. Lenders will also want to see that the rental income you expect to receive will more than cover your monthly repayments. 

How mortgage rates work 

Mortgage rates are the interest rate you pay to a lender on the mortgage balance you have outstanding. The lower your mortgage rate, the lower your monthly mortgage repayments tend to be, and vice versa.  

Different types of mortgage

The type of mortgage you take out can affect the mortgage rate you pay, and whether it may change going forward.  

Fixed-rate mortgage

A fixed-rate mortgage guarantees that your mortgage rate, and therefore your monthly repayments, won’t change during the set fixed-rate period that you choose. 

This can help with budgeting and means you are protected against a rise in mortgage costs if interest rates begin to increase. However, you’ll miss out if interest rates start to fall while you are locked into a fixed-rate mortgage.  

Variable rate mortgages

With a variable rate mortgage, your mortgage rate has the potential to rise and fall and take your monthly repayments with it. This may work to your advantage if interest rates decrease, but means you’ll pay more if rates increase. Variable rate mortgages can take the form of:  

Offset mortgages

With an offset mortgage, your savings are ‘offset’ against your mortgage amount to reduce the interest you pay. You can still access your savings, but won’t receive interest on them. Offset mortgages are available on either a fixed or variable rate basis. 

Interest-only mortgages

An interest-only mortgage allows you to make repayments that cover the interest you’re charged each month but won’t pay off any of your original mortgage loan amount. This helps to keep monthly repayments low but also requires that you have a repayment strategy in place to pay off the full loan amount when your mortgage term ends. Interest-only mortgages can be arranged on either a fixed or variable rate.   

» MORE: Should I get an interest-only or repayment mortgage?

How rate changes could affect your mortgage payments

Depending on the type of mortgage you have, changes in mortgage rates have the potential to affect monthly mortgage repayments in different ways. 

Fixed-rate mortgage

If you’re within your fixed-rate period, your monthly repayments will remain the same until that ends, regardless of what is happening to interest rates generally. It is only once the fixed term expires that your repayments could change, either because you’ve moved on to your lender’s SVR, which is usually higher, or because you’ve remortgaged to a new deal, potentially at a different rate. 

Tracker mortgage

With a tracker mortgage, your monthly repayments usually fall if the base rate falls, but get more expensive if it rises. The change will usually reflect the full change in the base rate and happen automatically, but may not if you have a collar or a cap on your rate. A collar rate is one below which the rate you pay cannot fall, while a capped rate is one that your mortgage rate cannot go above.    

Standard variable rate mortgage

With a standard variable rate mortgage, your mortgage payments could change each month, rising or falling depending on the rate. SVRs aren’t tied to the base rate in the same way as a tracker mortgage, as lenders decide whether to change their SVR and by how much. However, it is usually a strong influence that SVRs tend to follow, either partially or in full.  

» MORE: How are fixed and variable rate mortgages different? 

Mortgage Calculators

Playing around with mortgage calculators is always time well-spent. Get an estimate of how much your monthly mortgage repayments may be at different loan amounts, mortgage rates and terms using our mortgage repayment calculator. Or use our mortgage interest calculator to get an idea of how your monthly repayments might change if mortgage rates rise or fall.

Can I get a mortgage?

Mortgage lenders have rules about who they’ll lend to and must be certain you can afford the mortgage you want. Your finances and circumstances are taken into account when working this out.

The minimum age to apply for a mortgage is usually 18 years old (or 21 for a buy-to-let mortgage), while there may also be a maximum age you can be when your mortgage term is due to end – this varies from lender to lender. You’ll usually need to have been a UK resident for at least three years and have the right to live and work in the UK to get a mortgage. 

Checks will be made on your finances to give lenders reassurance you can afford the mortgage repayments. You’ll need to provide proof of your earnings and bank statements so lenders can see how much you spend. Any debts you have will be considered too. If your outgoings each month are considered too high relative to your monthly pay, you may find it more difficult to get approved for a mortgage.

Lenders will also run a credit check to try and work out if you’re someone they can trust to repay what you owe. If you have a good track record when it comes to managing your finances, and a good credit score as a result, it may improve your chances of being offered a mortgage. 

If you work for yourself, it’s possible to get a mortgage if you are self-employed. If you receive benefits, it can be possible to get a mortgage on benefits

Mortgages for bad credit

It may be possible to get a mortgage if you have bad credit, but you’ll likely need to pay a higher mortgage interest rate to do so. Having a bad credit score suggests to lenders that you’ve experienced problems meeting your debt obligations in the past. To counter the risk of problems occurring again, lenders will charge you higher interest rates accordingly. You’re likely to need to source a specialist lender if you have a poor credit score or a broker that can source you an appropriate lender.

What mortgage can I afford?

Getting a mortgage in principle from a lender will give you an idea of how much you may be allowed to borrow before you properly apply. This can usually be done without affecting your credit score, although it’s not a definite promise from the lender that you will be offered a mortgage. It is sometimes also called an agreement or decision in principle.

You’ll also get a good idea of how much mortgage you can afford to pay each month, and how much you would be comfortable spending on the property, by looking at your bank statements. What is your income – and your partner’s if it’s a joint mortgage – and what are your regular outgoings? What can you cut back on and what are non-negotiable expenses? And consider how much you would be able to put down as a house deposit. It may be possible to get a mortgage on a low income but much will depend on your wider circumstances. 

» MORE: How much can I borrow for a mortgage?

Joint mortgages

Joint mortgages come with the same rates as those you’ll find on a single person mortgage. However, if you get a mortgage jointly with someone else, you may be able to access lower mortgage rates than if you applied on your own. This is because a combined deposit may mean you can borrow at a lower LTV where rates tend to be lower. Some lenders may also consider having two borrowers liable for repaying a mortgage as less risky than only one.

The importance of loan to value

Your loan-to-value (LTV) ratio is how much you want to borrow through a mortgage shown as a percentage of the value of your property. So if you’re buying a home worth £100,000 and have a £10,000 deposit, the mortgage amount you need is £90,000. This means you need a 90% LTV mortgage. 

The LTV you’re borrowing at can affect the interest rate you’re charged. Mortgage rates are usually lower at the lowest LTVs when you have a larger deposit. Sometimes, saving a bigger deposit while keeping a close watch on property prices could push you into a lower LTV bracket, where rates may be better.

» MORE: What is happening to UK house prices?   

What other mortgage costs, fees and charges should you be aware of?

It’s important to take into account the other costs you’re likely to face when buying a home, and not just focus on the mortgage rate alone. These may include:

Stamp duty

Stamp duty is a tax you may have to pay to the government when buying property or land. At the time of publication, if you’re buying a residential home in England or Northern Ireland, stamp duty only becomes payable on properties worth over £250,000. Different thresholds and rates apply in Scotland and Wales, and if you’re buying a second home. You may qualify for first-time buyer stamp duty relief if you’re buying your first home. 

» MORE: Stamp duty calculator

Mortgage deposit

Your mortgage deposit is the amount of money you have available to put down upfront when buying a property – the rest of the purchase price is then covered using a mortgage. Even a small deposit may need to be several thousands of pounds, though if you have a larger deposit this can potentially help you to access lower mortgage rate deals.

Mortgage fees

Whether you’re taking out your first mortgage or switching to another deal, there are several charges, fees and remortgage costs which are directly related to mortgages that you may need to pay, including: 

Arrangement fees

Sometimes also referred to as the completion or product fee, this is a charge paid to the lender for setting up the mortgage. It may be possible to add this on to your mortgage loan although increasing your debt will mean you will be charged interest on this extra amount, which will increase your mortgage costs overall. 

booking fees

This is essentially a charge made to reserve a mortgage while your application is being considered, though it may also be included in the arrangement fee. It’s usually non-refundable, meaning you won’t get it back if your application is turned down. 

valuation fees

This pays for the checks that lenders need to make on the property you want to buy so that they can assess whether its value is in line with the mortgage amount you want to borrow. Some lenders offer free house valuations as part of their mortgage deals. 

house survey fees

You may want to arrange a house survey so that you can check on the condition of the property and the extent of any repairs that may be needed. A survey should be conducted for your own reassurance, whereas a valuation is for the benefit of the lender and may not go into much detail, depending on the type requested by the lender.    

conveyancing fees

Conveyancing fees cover the legal fees that are incurred when buying or selling a home, including the cost of search fees for your solicitor to check whether there are any potential problems you should be aware of, and land registry fees to register the property in your name. 

higher lending charge

Some lenders apply this charge if you have a small deposit and are borrowing at a higher LTV. Lenders use the funds to buy insurance that protects them against the risk your property is worth less than your mortgage balance should you fail to meet your repayments and they need to take possession of your home. 

broker or advice fees

If you get advice or go through a broker when arranging your mortgage, you may need to pay a fee for their help and time. If there isn’t a fee, it’s likely they’ll receive commission from the lender you take the mortgage out with instead, which is not added to your costs.  

early repayment charges

These are fees you may have to pay if you want to pay some or all of your mortgage off within a deal period.  Early repayment charges are usually a percentage of the amount you’re paying off early and tend to be higher the earlier you are into a mortgage deal.

Government schemes to help you buy a home

There are several government initiatives and schemes designed to help you buy a home or get a mortgage.   

95% Mortgage Guarantee Scheme 

The mortgage guarantee scheme aims to persuade mortgage lenders to make 95% LTV mortgages available to first-time buyers with a 5% deposit. It is currently due to finish at the end of June 2025.

Shared Ownership 

The Shared Ownership scheme in England allows you to buy a share in a property rather than all of it and pay rent on the rest. Similar schemes are available in Scotland, Wales and Northern Ireland.   

Help to Buy

The Help to Buy equity loan scheme, designed to help buyers with a smaller deposit, is still available in Wales, but not in England, Scotland and Northern Ireland. 

Forces Help to Buy

The Forces Help to Buy Scheme offers eligible members of the Armed Forces an interest-free loan to help buy a home. The loan is repayable over 10 years.  

First Homes Scheme 

Eligible first-time buyers in England may be able to get a 30% to 50% discount on the market value of certain properties through the First Homes scheme.

Right to Buy

Under this scheme, eligible council tenants in England have the right to buy the property they live in at a discount of up to 70% of its market value. The exact discount depends on the length of time you’ve been a tenant and is subject to certain limits. Similar schemes are available in Wales, Scotland and Northern Ireland, while there is also a Right to Acquire scheme for housing association tenants.

Lifetime ISAs 

To help you save for a deposit, a Lifetime ISA will see the government add a 25% bonus of up to £1,000 per year to the amount you put aside in the ISA.

How to apply for a mortgage

You may be able to apply for a mortgage directly with a bank, building society or lender, or you may need or prefer to apply through a mortgage broker. You’ll need to provide identification documents and proof of address, such as your passport, driving license or utility bills.

Lenders will also want to see proof of income and evidence of where your deposit is coming from, including recent bank statements and payslips. It will save time if you have these documents ready before you apply.  

» MORE: Best mortgage lenders    

Would you like mortgage advice?

Taking out a mortgage is one of the biggest financial decisions you’ll ever make so it’s important to get it right. Getting mortgage advice can help you find a mortgage that is suitable to you and your circumstances. It also has the potential to save you money. 

If you think you need mortgage advice, we’ve partnered with online mortgage broker London & Country Mortgages Ltd (L&C) who can offer you fee-free advice. 

Key mortgage terms explained 

Loan to value (LTV)Your loan-to-value ratio is the amount you wish to borrow through a mortgage expressed as a percentage of the value of the property you’re buying.
Initial interest rateThis is the interest rate you’ll pay when you’re still within the initial fixed-rate period of a mortgage deal.
Initial interest rate periodThis is the period of time your initial interest rate will last, before your lender switches you over to its SVR.
Annual Percentage Rate of Charge (APRC)The APRC is a single percentage figure designed to help you compare the annual cost of different mortgage deals.
Annual overpayment allowance (AOA)This is the amount a lender will let you overpay on your mortgage each year without being charged a fee.
Early Repayment Charge (ERC)This is a charge you may need to pay if you want to pay off some or all of your mortgage earlier than you agreed with your lender.
Mortgage termA mortgage term is the full period of time over which the mortgage contract is taken out for – it should not be confused with the deal term. At the end of the term you will have paid off the full debt or all of the interest depending on what type of mortgage you took.

Mortgage Rates FAQs

What are the current UK mortgage rates?

The current average rate on a two-year fixed-rate mortgage for a 10% deposit or equity is 5.66%, up from 5.63% a week earlier. For an equivalent five-year fixed-rate mortgage, the average rate is 5.19%, up slightly from 5.18% the week before. If you have a 25% deposit/equity, the average two-year fixed mortgage rate remained unchanged at 5.30%, while the average five-year fixed rate stayed the same at 4.91%. All rates are according to Rightmove as at 13 June 2024.

What are mortgage rates?

A mortgage rate is the interest rate a lender charges on the mortgage amount that you borrow. Mortgage interest rates may be fixed, guaranteeing that they will remain the same for a certain length of time, or variable, meaning it may fluctuate. 

Who offers the best mortgage rates?

Mortgage providers regularly review the mortgage rates that they offer to take into account the costs involved with funding its lending activities, their latest priorities in terms of target borrowers, and wider conditions in the market. As a result, when searching for a new mortgage, it’s always a good idea to consider various lenders and take the time to compare different mortgages. Crucially, you need to bear in mind that a deal offering the best mortgage rate may not necessarily be the one that is most suitable for you. The mortgage rate is important, but at the same time, you need to consider other factors, such as the charges and fees attached to a mortgage, the type of mortgage that you need, and the mortgage term that you want.

Will UK mortgage rates go down in 2024?

It was widely predicted that mortgage rates would fall during 2024. However, while notable reductions were seen throughout January, rates have mainly been rising ever since. Now, average mortgage rates are slightly higher than they were at the beginning of the year.      

The expected timetable of base rate cuts has been steadily moving back later into the year. The main reason being that inflation has fallen slower than was hoped. 

Investors are currently predicting the first cut in the base rate is most likely in September; at the start of the year this was expected in May. This is important because lenders take base rate expectations into account when setting mortgage rates.There are several other factors that can affect mortgage rates too. Overall, this means it is hard to predict with certainty what is likely to happen to mortgage rates going forward. 

 

What’s the difference between interest rate and APRC?

The interest rate is the percentage of a loan amount that a lender charges for borrowing money, whereas the APRC, or annual percentage rate of charge, is a calculation expressed as a percentage that takes into account both the interest rate and associated costs of a mortgage across its lifetime. The aim of the APRC is to help borrowers make meaningful comparisons between mortgage deals.

How can I improve my chances of getting the best mortgage deal?

Taking the time to compare mortgage rates and deals, making sure your credit score is in good shape, saving for a larger deposit and paying off existing debts can all help improve your chances of getting a good mortgage deal.

Is it ok to compare mortgage lenders?

When looking for a mortgage it is vital that you compare mortgage lenders and the rates and deals on offer. Taking the time to carry out a mortgage comparison can improve your chances of finding the best mortgage for your circumstances.

What is a mortgage?

A mortgage is a loan you take out to help you buy a property you don’t have the money to pay for up front. You may be a first-time buyer, remortgaging, securing a buy to let, or moving to your next home. The amount you need to borrow will depend on the purchase price of the property, and how much you can put down as a deposit or already hold in equity in your current property. The mortgage is secured against the property, which means your home is at risk if you don’t meet the repayments.

What is a capital repayment mortgage?

With a capital repayment mortgage, your monthly repayments pay off your interest and some of your original loan amount each month, so that everything should be paid off by the time you reach the end of your mortgage term. The alternative to a repayment mortgage is an interest-only mortgage, where you will repay only the interest each month before needing to pay off your original loan amount in its entirety at the end of the mortgage term.

What is a mortgage term?

A mortgage term is the period of time you agree with a lender over which you intend to entirely pay off your mortgage and interest. A typical mortgage term in the UK is usually considered to be 25 years, but you may opt for a shorter period or a longer one, if allowed. Some lenders offer mortgage terms of up to 40 years. If you have a longer term, your monthly repayments will be lower, but you’ll pay more interest overall.

How much will my mortgage cost?

The cost of your mortgage will depend on many factors, including how much you borrow, the size of your deposit, the length of your mortgage term, the mortgage rate you’re paying, and whether you can afford to make overpayments. Your mortgage lender must provide you with the full cost of the mortgage before you apply.

» MORE: How much could your mortgage cost you?

What other costs might I need to pay?

Besides making sure your monthly repayments are affordable, there are many other costs associated with arranging a mortgage. These may include arrangement, survey, valuation and mortgage broker fees.

If you’ve previously owned a home and the property you’re buying is worth more than £250,000, stamp duty will be payable as well; if you’re a first-time buyer, stamp duty only becomes payable on properties worth over £425,000.

Can I get a first-time buyer mortgage?

To get a mortgage as a first-time buyer you’ll usually need at least a 5% deposit and a regular income. Most lenders offer first-time buyer mortgages aimed primarily at those with smaller deposits. First-time buyers may also be able to secure a mortgage with the help of close relatives through a guarantor mortgage.

How do I get a buy-to-let mortgage?

Some lenders offer buy-to-let mortgages that can be arranged on a property you want to rent out to a tenant, rather than live in yourself. You’ll usually need a larger deposit for a buy-to-let mortgage than for a residential mortgage, and interest rates are often higher. You may also need to already own your own home or have a residential mortgage on another property.

Can I get a mortgage with bad credit?

It may be possible to get a mortgage with bad credit but you’ll probably have fewer mortgage deals to choose from and need to pay higher mortgage rates.

Should I remortgage?

You may want to consider remortgaging if your initial fixed-rate period is close to ending and you want to avoid moving on to your lender’s SVR. Choosing to remortgage has the potential to save you money if you find the right mortgage deal. It may be possible to remortgage with the same lender or you may want to switch to a different provider if they are offering a better deal.

What else do you need to consider when looking for a mortgage?

It’s always important to think about your plans, particularly when it comes to choosing the type of mortgage that will suit you best. For instance, if you plan to move in perhaps two years, choosing a five-year fixed-rate mortgage may mean you have to pay early repayment charges if you need to get a new mortgage.

What is a mortgage agreement in principle?

Getting an agreement in principle, or AIP, from a lender will give you an idea of how much you may be able to borrow for your mortgage without needing to formally apply. Getting an AIP usually involves a soft credit check, which shouldn’t affect your credit score. However, having an AIP does not guarantee that a lender will offer you a mortgage. An agreement in principle is also sometimes referred to as a decision in principle or a mortgage promise.

Are Islamic mortgages available in the UK?

Yes, some providers offer halal or Islamic mortgages in the UK. These are compliant with Sharia law and allow people to borrow but not pay interest.

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a loan or any other debt secured on it.

Information on this page is a guide. It does not constitute advice, recommendation or suitability to your needs or financial circumstances. Seek qualified mortgage advice before proceeding with a mortgage product.

NerdWallet strives to keep its information accurate and up to date. This information may be different than what you see when you visit a financial institution, service provider or specific product’s site. All financial products and services are presented without warranty. When evaluating products, please review the financial institution’s Terms and Conditions.

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