Knowledge Center

A fixed rate mortgage will allow you to lock in the rate you pay on your mortgage for 2,3,5 or 10 years and sometimes even longer. It should be noted that the longer the fixed rate period, the higher the interest that you will pay.

Whilst the fixed rate term is often chosen to give repayment certainty and protect against future interest rises several factors should be considered when choosing this. You may want to choose a:

• 2 or 3-year deal – if you are considering selling the house in the next few years. If you expect short term financial changes, e.g., an inheritance or windfall, this may be a more suitable product to choose.
• 5-year deal – This may be suitable if you expect to stay in your home for a longer period and you expect no change in your financial circumstances.
• 10-year deal – Ideal if you want to protect yourself from potential interest rate increases. Remember that you could potentially miss out on lower payments if interest rates go down.

When deciding if a fixed interest rate term is right for you, please remember that you could face higher charges if your circumstances change and you want to come out of the deal before it ends.