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Mortgages Expert Guide

Fixed Rate Mortgage

Fixed Rate Mortgages are amongst the most popular mortgages available. They are as the name suggests a mortgage with a fixed rate for a predetermined period, typically 2,3 or 5 years. Fixed Rate Mortgages are however available from anything for 6 months to the whole term.

As a general rule of thumb the longer the fixed rate period the higher the APR.Remember like all mortgages with a predetermined period you will revert to the mortgage lenders Standard Variable Rate at the end of the period

Fixed Rate Mortgage Pros

  • You are protected against interest rates rises during the period you have signed up for
  • Your monthly payment is the same for the period signed up for which helps with your budgeting


Fixed Rate Mortgage Cons

  • Should interest rates fall during your fixed period you will not benefit from the potential reduction in monthly payments
  • There are usually arrangement fees which can vary from a few hundred to thousands
  • There are usually redemption fees of anything up to six months interest if you decide to redeem your mortgage early. If your considering moving within the fixed rate period make sure your mortgage is portable.
  • There can be redemption fees for a significant period after your fixed rate period if you decide to redeem your mortgage early. If you are on a fixed rate that is signinficantly below the Standard Variable Rate then pay particular attention to this element of your mortgage
  • Your payments may rise significantly after your fixed period if interest rates have risen

Back to Mortgage Types

 

2 Year Fixed Rate Mortgage Table
2-5 Year Fixed Rate Mortgage Table
5-10 Year Fixed Rate Mortgage Table

 

 

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