Is now the right time to fix your mortgage deal? We reveal what brokers think

IT’S the question on the lips of all homeowners and aspiring buyers. Is now the right time to fix your mortgage?

Mortgage rates remain high – but expectations of a Bank of England cut to interest rates later this summer are growing.

We spoke to brokers to find out whether it's a good time to fix a mortgage offer


We spoke to brokers to find out whether it’s a good time to fix a mortgage offer

We explain what’s happening, whether you should consider fixing your mortgage and explain the other options that are available to you.


Last year, a series of base rate hikes and disappointing inflation figures lead to a rise in two-year fixed mortgage rates hitting a high of 6.85% in August 2023.

Borrowers on tracker mortgages and standard variable rates saw their mortgage rate rise every time the Bank of England put the base rate up.

While those on fixed mortgages have seen bills go up by £3,000 a year as their deals end, according to Moneyfacts.


This year an estimated 1,6 million will see their fixed deals end, this year, according to UK Finance, meaning they face higher costs.

But as inflation started to fall and the base rate was held at 5.25% since August, mortgage rates started to edge down at the start of the year.

The average two-year fixed rate mortgage is now 5.93%.

Best schemes for first-time buyers

But so long as the BoE continues keep interest rates the same, mortgages rates will remain roughly the same.

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Some lenders including NatWest and Barclays have been cutting rates in anticipation that the base rate will be cut in August.

This is because the latest figures from the Office for National Statistics (ONS) revealed inflation hit the BoE’s 2% target.

The Bank’s aim is to bring inflation back under control after months of double digit price rises.

How do you find the best mortgage deals?

WE explain how to ensure you get the best deal on your mortgage or remortgage:

Websites such as  MoneySuperMarket and Moneyfacts have mortgage sections so you can compare costs. All the banks and building societies will have their offers available on their sites too.

If you’re getting confused by all the deals on the market, it might be worth you speaking to a mortgage broker, which will help find the best mortgage for you.

A broker will typically cost between £300 and £400 but could help you save thousands over the course of your mortgage.

You’ll also have to decide if you want a fixed-deal where the interest you’re charged is the same for the length of the deal or a variable mortgage, where the amount you pay can change depending on the Bank of England Base Rate.

Remember, that you’ll have to pass the lender’s strict eligibility criteria too, which will include affordability checks, and looking at your credit file.

You may also need to provide documents such as utility bills, proof of benefits, your last three month’s payslips, passports and bank statement.

If inflation is steady, there is less pressure on the Bank of England to put the base rate up further.

This is because inflation is driven by demand.

The more money we have access to, the more we can spend.

Nicholas Mendes, mortgage technical manager at broker John Charcol, said: “The outlook for 2024 suggests a modest reduction in mortgage rates by the end of the year, but more substantial drops are expected in 2025.

“It’s essential to keep an eye on economic developments, as factors like inflation control and overall market stability will significantly influence these adjustments.”

Of course, no one can predict with any certainty if or when mortgage rates will change.

So, what can households do to manage costs? We take a look at the options.

Should I fix my mortgage now?

If you’re nearing the end of your fixed mortgage or first-time buyer, this will no doubt be the question that you most want answered.

There are three types of mortgage deals on offer to homeowners – a tracker mortgage, a standard variable rate (SVR) and a fixed-rate.

Tracker mortgages

Tracker mortgages, also known as variable rate tracker mortgages, are linked to the BoE base rate.

It means that, unlike fixed-rate mortgages, your monthly payments can go up or down depending on the wider economy.

Today’s average two-year tracker rate is 5.94%, according to financial website Moneyfacts.

Karen Noye, mortgage expert at Quilter, said: “Anyone who is currently in the process of securing a mortgage will need to very carefully consider their options and what is most important to them.

“The tracker rates currently on offer are above the Bank of England’s base rate, but some come with no early repayment charges which can provide more flexibility.”

While tracker are proving an increasingly popular option, there is an element of risk involved.

Should the Bank of England base rate rise, opting for fixed rate provides financial peace of mind.

How to save for your first home

HAVE you ever wondered how first-time buyers manage to go from savers to homeowners?

Getting a foot on the property ladder might seem like a daunting task, but The Sun’s My First Home feature allows you to find out exactly what it takes to finally get the keys to your own place.

Leanne Gem managed to buy her £456,000 four-bed house with an “underrated scheme”.

Karis Jacobs and her husband George used the 50/50 method to buy their first home just two years after losing their jobs.

Parents Chae and Cem used a “DIY Help to Buy scheme” to buy their £466,000 first home.

Anupam and his wife Shrabanti lost £6,000 free cash when buying their first home – here’s how you can avoid it.

Standard variable rates

A standard variable rate (SVR) is a default rate offered by banks. You usually revert to this at the end of a fixed deal term.

David Hollingworth, associate director of L&C Mortgages, said: “The SVR will typically be significantly higher than could be found on other deals, so even if it was to drop borrowers will be paying a whole lot more than if they shopped around for a better deal. 

“Sitting on SVR in the hope that fixed rates will improve could be the motivation but even a few months on SVR could outweigh some small improvements, if they come at all.

“But a better option for those that want some flexibility could be a tracker deal.”

The best standard variable rate is currently just under 7% and the average is 8.17% as of July 1.

Fixed-rate mortgage

A fixed-rate mortgage means your monthly payments will stay the same for the length of the agreed term, which offers more certainty.

The average two-year fixed residential mortgage rate today is 5.95%, according to financial website Moneyfacts.

Meanwhile, the average five-year fixed residential mortgage rate today is 5.53%.

But the best rate is currently available through Santander with an interest rate of 4.2% with 60% loan to value (LTV).

David said: “Fixed rates are currently lower than corresponding variable deals as the rates are determined by what is expected to happen to interest rates. 

“In fact the five year rates are currently lower than two year rates, as the longer term forecast is for rates to reduce. 

“As a result, even if base rate does fall there’s no guarantee that fixed rates will react as they are already pricing some cuts in.  I

“It’s only when things shift more radically or external factors change the forecast that fixed rates can move up or down.”

Ryan Davies, strategy director at Bluestone Mortgages, said that would-be and existing borrowers always have their own circumstances to consider too.

He said: “In this challenging environment, affordability should be a key factor in the decision-making process.

“No matter whether you are a first-time buyer or looking to remortgage, you must ensure that you are able to comfortably meet the mortgage repayments required.

“The value of independent advice has never been more important.

“Whether you’re looking to move onto or up the property ladder, speaking to a mortgage broker is the best place to start.”

Mortgage brokers scour the market for the best mortgage deals available, based on your personal circumstances and requirements.

You want to make sure you speak to a broker who covers the “whole of market” and doesn’t just provide advice on selected mortgages.

Some brokers charge a fee upfront, while others will earn commission from the lender.

How will the election affect mortgage rates?

Following the Labour Party’s election victory, the possibility of an August interest rate cut could be placed on hold.

Laura Suter, director of personal finance at AJ Bell, said: “Labour has pledged an economic update in September – which casts some doubt on an August interest rate cut, as the Bank may decide to wait and see the outcome of that update before getting its axe out to cut rates.”


Meanwhile, Karen Noye, mortgage expert at Quilter added: “The current market conditions, characterised by high mortgage rates, continue to be a significant hurdle for many buyers.

“The Bank of England will eventually drop the base rate, but it is still uncertain when this will happen which heaps paralysis on the market.”

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