When choosing a mortgage, one of the first decisions is whether to go with a fixed or variable interest rate. A fixed-rate mortgage locks in your interest rate for a set period (usually 2, 5, or 10 years), offering predictable monthly payments. This is ideal for budgeting and protecting against rate rises.
A variable-rate mortgage, on the other hand, fluctuates with the Bank of England base rate or your lender’s standard variable rate. While initial rates may be lower, your payments can increase if interest rates rise.
Fixed rates offer stability, while variable rates may save money if rates fall. Consider your financial situation, risk tolerance, and future plans before choosing.
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