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Fixed Rate Mortgages

Fixed rate mortgages are ones where the interest rate does not change during the agreed period of the loan. This can help you when planning your repayments and cashflow.

fixed rate mortgageIf you take out a fixed rate mortgage you can be sure that the amount you pay each month will remain the same for a certain period of time. This means that a fixed rate mortgage can provide a degree of stability and allows you to budget effectively.

It is a common choice with borrowers, especially first time buyers, and there are a large number of fixed rate deals on the market. The fixed rate period is typically between 2 and 5 years although longer periods are available.

So, there are a number of positive aspects to fixed rate deals - is there any downside?

Any downsides?

The "price" of fixing your rate is that there will be a cost (Early Redemption Penalty) if you want to get out of the deal during the fixed rate period. This is typically expressed as a percentage of the loan and, therefore, could be expensive. If you want to move during the fixed rate period, your lender may not offer additional funds and, if they do, it may be on more expensive terms than your current deal. Also, when you reach the end of the fixed rate period you will move on to your lender's standard variable rate which, depending on interest rates at the time, may be significantly more expensive.

As with any other financial decision, whether a fixed rate mortgage is the best option for you comes down to your personal situation now and in the future and, as importantly, what makes you feel comfortable.
Talking to a professional adviser can help you decide. If you wish to speak to an LGBT-friendly financial adviser, please enter your postcode under the map on your right, to find an adviser near you.

Additional Reading

  • Standard Variable Rate Mortgages

    Check out deals on standard variable rate mortgages and call us for advice on how to look for the right mortgage for you.
  • Mortgage Protection

    With mortgage protection it does what it says on the tin! Get the right policy and if you are injured or have a long term illness, some or all of your mortgage payments are covered.
  • Discounted Mortgages

    Are you looking for discounted mortgages and mortgage products online? Why not check our simple guides and then call us for help.
  • Offset Mortgages

    An offset mortgage can help you pay off your mortgage early by allowing you to "offset" savings against the outstanding mortgage debt. Read our simple guide.
  • Tracker Mortgages

    Tracker mortgages do just that! Track the Bank of England base rate for the period of your mortgage agreement. Read our simple guide to find out more.

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