Fixed Rate Mortgages
Are you looking for stability and predictability in your mortgage payments? Look no further than a fixed rate mortgage.
- We find you the best mortgage deal from our panel of top lenders
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Discover how a fixed mortgage deal could save you money
Are you looking for stability and predictability in your mortgage payments? Look no further than a fixed rate mortgage.
A fixed rate mortgage offers homeowners the peace of mind of knowing that their interest rate and monthly payments will remain the same throughout the life of the loan. This means that you won’t have to worry about sudden increases in your mortgage payments due to fluctuations in the Bank of England base rates.
To find out how to secure yourself a fixed-rate mortgage deal at the best price, let Believe Money help. Believe Money is one of the UK’s most reputable brokers, supporting clients with varying needs to navigate the complex world of mortgage applications.
But first, find out whether you could be eligible for a fixed rate mortgage, and what you can expect from the application process.
What is a fixed-rate mortgage?
When people apply for mortgages, the biggest consideration is how the interest rates will impact them. Different deals are available, and the one you get depends on your lender and whether you meet the criteria.
Fixed-rate mortgages are so popular because they stay at the same interest rate for a period of time, offering more stability.
Most people get a fixed period of around two to five years and then move on to new terms. To understand what makes a fixed-rate deal such an attractive option, we must look at the other mortgage options.
Standard Variable Rate (SVR)
Lenders usually set standard variable rates and add an amount onto the Bank of England base rate, which you’ll have to pay. While these mortgages are relatively stable regarding your repayments, many people find they spend more than necessary.
Most fixed-rate mortgages transition to an SVR deal after the period ends, but there are better options out there which will help you save money.
Tracker mortgage
Tracker mortgages also use the Bank of England interest rates as a guide, and they can often be more cost-effective than a standard variable rate deal. However, while you’ll usually pay less, the repayments can change monthly, so you won’t know in advance what you’re paying each month.
Also, if the Bank of England’s interest rates skyrocket, you could be liable for hefty monthly repayments.
Offset mortgages
Offset mortgages aren’t as common as other agreements, but they can be beneficial for some people. They work by allowing people to use their savings to offset (reduce) their interest rates. Once you offset the outstanding balance, you’ll pay interest on the remaining amount.
Interest only mortgages
Interest-only deals are ideal for people who want to minimise their mortgage payments. Instead of paying a portion of the mortgage and its interest, you’ll only have to budget monthly payments for the interest rate.
However, when the term ends, you’ll also have to repay the loan, which means these mortgages aren’t suitable for everyone.
The benefits of a fixed-rate mortgage
A fixed-rate mortgage can provide a better option than other interest rates available, but it’s still important to understand what you get when you apply for one.
Some of the main benefits associated with fixed-rate mortgages include:
More stability
A house is probably the biggest purchase anyone will ever make, and how you manage your mortgage repayments will define which deals are available to you in the future. Fixed-rate deals give you more stability and help you budget for monthly payments.
While other deals are subject to changing interest rates, a fixed-rate mortgage will give you peace of mind and also protect you from getting into debt.
Budget for the future
The great thing about a fixed-rate deal is you can budget for future monthly repayments when the term ends. Interest rates fall and rise in line with the property market, and most people move onto SVR deals when their fixed rate term ends.
If you can take advantage of low-interest rates and put money aside for the transition, you won’t need to worry about getting into debt when transitioning to the lender’s standard variable rate.
Extra security
You don’t have to worry about changing interest rates on a fixed deal; you’re protected for the entire term. These deals can be highly beneficial in a challenging economy, and security is one of the reasons fixed interest rates are so popular.
How do fixed-rate mortgage deals work?
Fixed-rate mortgages commonly have a maximum term of five years, but some lenders offer a maximum of 15 years – but that’s not the norm. Two to five-year terms tend to be the most popular for homeowners.
The arrangement fees
Fixed-rate mortgages almost always involve arrangement fees, which you’ll have to factor into your budget. Also known as product fees or completion charges, the amount usually ranges from £999 to £1999.
Some lenders have introduced no fees, but they might have higher fixed interest rates, which still means you’re paying more money – but it’s easy to budget for it.
Strict overpayment terms
Fixed-rate lenders also tend to have strict overpayment terms to prevent people from paying off large chunks of their mortgages. However, the majority of fixed-rate mortgages come with 10% overpayment terms.
People can pay a maximum of 10% of their outstanding balance annually, but higher payments often result in higher charges.
Early repayment charges
Early repayment fees are one of the biggest things to consider when taking out a two to a five-year fixed-rate mortgage. Lenders have different charges, so checking the terms before agreeing to the deal is always best.
If you plan on staying within the monthly terms for the duration of your fixed-rate mortgage, you won’t need to worry about factoring in an early repayment charge. However, if you plan on moving relatively quickly, another mortgage deal might be more suitable.
Some people choose to pay off their fixed-rate mortgage early, and it is possible – as long as you budget for the charges and know exactly what your lender charges.
Get the best fixed-rate mortgage deal with Believe Money
Fixed-rate mortgages work well for first-time buyers and people who want some extra stability, but finding the right lender is no easy feat.
Believe Money is a specialist mortgage broker, and we work with clients from all backgrounds, helping them find a fixed-rate deal that suits their financial circumstances.
A fixed-rate mortgage means you don’t have to worry about your monthly repayments for a set time, and our brokers will help you get that elusive peace of mind.
Here’s how we can help you:
Access to more mortgage providers
While mainstream providers often look at general search criteria, specialist lenders judge each case individually but prefer to work through brokers.
Our extensive database of specialist lenders ensures you get the best mortgage rates. Whether you’re self-employed or need a bespoke deal that factors in your loan to value (LTV), our team of brokers can help.
Zero upfront fees
You shouldn’t have to worry about brokers’ fees when looking for a fixed mortgage deal – especially with the arrangement charges being likely. We ensure you don’t have to budget for our service by ensuring zero upfront payments.
Instead, our small fee is added to your mortgage deal, so you won’t have to worry about it.
Peace of mind
You also won’t need to worry when your fixed rate deal ends because you can work with our brokers to find a new provider if you feel that’s better than moving onto the lender’s standard mortgage rate.
As an award-winning team of brokers, we’ve helped numerous clients with varying circumstances, so you can rest assured that you’ll always get the best deals with us on your side.
Book a free consultation today
If you’d like to discuss your eligibility and get access to the best fixed-rate mortgage deals, please feel free to get in touch for a free consultation.
There’s no obligation to go ahead, but our friendly brokers would love to help arrange you a stress-free mortgage deal.
Contact us today, and we’ll get the ball rolling on your search.
About Company
Believe Money is an award-winning mortgage broker with access to exclusive deals from our extensive panel of providers, including no upfront fees and low interest rates to suit your circumstances. Choosing the right mortgage is one of the most important decisions you could ever make and it pays to use an expert like Believe to make sure you’re getting the best deal to suit you now and in the future.
Whether you’re moving house, looking to remortgage or want a good deal on a mortgage refinance, Believe Money works hard to get you the best deal in a smooth, hassle-free process with ongoing support. As soon as you contact us, we’re here at every step of the mortgage journey, right through to completion.
Ready to find the best mortgage deal? Contact us online or give us a call on 01302 591 360.
Why Use Believe Money?
Believe Money is an award-winning finance broker dedicated to offering the best range of affordable loan options. Whatever your circumstances or credit rating, we’re committed to getting you the best secured loan interest rates by searching our entire panel of secured loan providers.
Whatever you need a secured loan for, we’re here to help. Our specialist advisors are available Monday to Friday, so if you need any help please contact us online or give us a call on 01302 591 360.
How It works
Step 1.
Simple, easy application
Step 2.
We search a panel of lenders to find the right deal for you
Step 3.
Our bespoke technology and skilled advisors support you all the way
Step 4.
The money lands in your bank
account – usually within two weeks
We compare mortgages from our panel of the UK’s top lenders to get you the best deal.
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