Should I Fix my Mortgage?

Why should I fix my mortgage?

Fixing your mortgage will provide peace of mind and will make budgeting easier for many customers. A fixed mortgage will mean your monthly payment will stay the same for the length of time of the deal.

Many of our first time buyer mortgage customers choose to fix their rate for 2, 3, or 5 years for stability while they get used to paying monthly bills and running a property.

For existing homeowners, if you are approaching the end of your current fixed-rate deal and you’re not looking to make any changes to your mortgage, you’ll have the option of: 

1. Taking a new product transfer mortgage fixed rate with your current lender.  

2. Going on to your lenders standard variable rate (SVR), usually with no tie in.  

3. Searching the market and remortgaging for a new fixed rate or alternative product.  

Fixing your mortgage rate is not for everyone, however, most prefer the security they offer.  Alternative products and features are also available such as tracker mortgages, variable rates, discounted rates, off-set mortgages etc.

Without being fixed into a deal, rates can change extremely quickly.  Lenders will pass on both increases and decreases in interest rates straight away therefore your monthly outgoings will fluctuate.  

Should I fix for 2 or 5 years? 

Fixing our mortgage for 2 or 5 years will depend on your personal attitude towards risk.  If you think that interest rates may go down soon then a 2-year deal might work better for you, alternatively, if you think they’ll go up then 5-years will be better.

For many homeowners, their biggest monthly commitment is their mortgage payment and often, especially first time buyer mortgage customers and home movers, like the stability that this is fixed for a set period.

Nobody has a crystal ball and we’ve all witnessed how unforeseen economic events can affect interest rates. Therefore, whether you should fix for 2 or 5 years is down to your personal preference.

A good place to start is by asking yourself, ‘how much of a risk-taker am I?’ 

If you have a lot of spare income, you might choose to be high risk and bet on rates decreasing over 2-years. However, if you do not have much disposable income and would struggle if your payments increased, a 5-year deal maybe more suitable as you know your current monthly payment is affordable.

A mortgage broker will help you explore your options and recommend the best purchase or remortgage deal for your personal situation.  

Written by
Malcolm Davidson
Managing Director of UK Moneyman Ltd.
MAQ & CeRER Qualified

26th March 2024

About the Author

Malcolm Davidson

Managing Director of UK Moneyman LTD

Malcolm is one of the UK’s most well-known and respected Mortgage Advisors. He is passionate about providing a 5* customer experience and he has also trained and mentored dozens of fellow Advisors in a career that is now in its third decade.

In addition to his day to day duties as Managing Director, Malcolm still gives out mortgage advice and feels lucky that his job is also very much his hobby.

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