When choosing a mortgage, one of the biggest decisions is whether to go with a fixed-rate or a variable (tracker or standard variable) rate mortgage. Here’s a quick breakdown to help you decide:
Fixed-Rate Mortgage
Your interest rate stays the same for a set period—typically 2, 3, or 5 years.
- Predictable monthly payments
- Protection from interest rate increases
- May have slightly higher initial rates
Variable-Rate Mortgage
The interest rate can change, usually in line with the Bank of England base rate or the lender’s standard variable rate.
- Often lower starting rate
- You could pay less if rates fall
- Your payments could rise if rates increase
Key Considerations:
Think about your financial stability, risk appetite, and whether you need certainty in your budgeting. The right option depends on your personal and financial circumstances.
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