Table of Content
If you have a fixed-rate mortgage, you’re not alone. In recent years, almost 86% of all mortgages have been arranged on a fixed-rate basis. We’ve been blessed with historically low interest rates for almost a decade now.
However, it’s important to know your options when your fixed-rate mortgage term ends, especially in times when rates are more expensive than they have been in recent years.
What is a fixed-rate mortgage?
A fixed-rate mortgage is a type of home loan where the interest rate remains constant throughout the entire term of the loan. This means that your monthly mortgage payments will also remain the same over the agreed-upon period.
The most common terms for fixed-rate mortgages are 2, 3, and 5 years, but they are also available for other durations, including sometimes up to 10 years. During the fixed-rate period, the interest rate does not change, regardless of any fluctuations in the broader financial market or changes in the base interest rate set by the central bank.
This offers stability and predictability to homeowners, as they can budget and plan their finances without worrying about changes in their mortgage payments due to interest rate variations.
What happens when your fixed rate ends?
At the end of a fixed-rate mortgage, if you don’t take any action, your mortgage will typically revert to the lender’s standard variable rate (SVR). The SVR is usually higher than the fixed rate you had been paying. It’s important to note that the SVR can vary between lenders.
However, you have options available to you. You can choose to negotiate a new deal with your existing lender, which could include another fixed-rate term or a different type of mortgage product. Alternatively, you have the freedom to explore offers from other lenders and potentially switch your mortgage to a new lender offering a more competitive rate or terms.
Looking for 5 star mortgage advise? We’re ready to help.
Whatever stage you’re at, it’s never too early to reach out.
View all 53 reviews on Trustpilot
5 star based on 203 Google reviews
What are your options at the end of a fixed-rate mortgage?
At the end of a fixed-rate mortgage, you have several options to consider:
- Revert to the Standard Variable Rate (SVR): If you don’t take any action, your mortgage will automatically switch to the lender’s SVR. However, the SVR is typically higher than the rate you had during the fixed-rate period.
- Choose a New Deal with Your Existing Lender: You can negotiate with your current lender for a new mortgage deal. This could involve selecting another fixed-rate term, a variable-rate mortgage, or exploring other products they offer.
- Choose a New Deal with a New Lender: You have the option to shop around and switch your mortgage to a new lender offering more favourable rates or terms. This process is known as remortgaging or refinancing.
- Sell the Property: If you no longer wish to keep the property or if it suits your financial goals, you can choose to sell the property and use the proceeds to pay off the mortgage.
What is the process when your fixed-rate mortgage is coming to an end?
The process at the end of a fixed-rate mortgage typically involves the following steps:
- Start Early: It is advisable to start planning and researching your options well in advance of the end of your fixed-rate term. You can begin this process up to six months before your current rate expires.
- Speak to a Mortgage Broker: Consider consulting with a mortgage broker like Strive who can provide expert advice and access to a wide range of lenders and mortgage products. They can help you assess your options and find the most suitable mortgage for your needs.
- Contact Your Existing Lender: Reach out to your current lender and inquire about their offerings for customers whose fixed-rate term is ending. They may have new products or deals available that could be advantageous to you.
- Evaluate All Options: Compare the options presented by your existing lender with those provided by other lenders through your broker. Consider factors such as interest rates, terms, fees, and any additional benefits or features that may be important to you.
- Make a Decision: Based on your research, discussions with your lender, and advice from your broker, make an informed decision about the next steps for your mortgage. This could involve choosing a new mortgage product with your existing lender or opting for a mortgage from a different lender.
- Complete the Application: Once you have made a decision, you will need to complete the application process for the chosen mortgage. This typically involves providing necessary documentation, undergoing credit checks, and meeting the lender’s criteria.
See What Our Clients Say
Outstanding service and clear communication are at the core of what we do. But don’t just take our word for it—read firsthand experiences from our clients and discover why they rate us a 5-star mortgage broker.
Ashley Oldershaw2025-03-12Trustindex verifies that the original source of the review is Google. We worked with Jack, who was very clear in his explanations, spent some time learning about our situation and presented us with our options and the pros and cons of each. He was also very proactive and understood that this was unfamiliar territory for us. Jack made sure that he did everything he could to provide a smooth process from start to finish, which helped us out a lot. Thanks, Jack! Farshad Farzaneh2025-03-11Trustindex verifies that the original source of the review is Google. Jack Johnson is the mortgage broker we used from Strive mortgages and he has been very helpful and an absolute easment for the whole process of getting a mortgage. He's easy to get hold of and makes plenty of time for his clients. He has useful contacts across the industries (banks and estate agents) which can be helpful in many circumstances, especially for quick answers and resolutions to problems. Mark Williams2025-03-11Trustindex verifies that the original source of the review is Google. Jamie has been consistent in providing me with an excellent service over many years, so I wouldn't dream of using anyone else. I've also recommended him to friends and family. Peter Macciochi2025-03-11Trustindex verifies that the original source of the review is Google. James has always been detailed but extraordinarily helpful. Always get the best advice and deals out there - simply do not go anywhere else !! Matt Ploszajski2025-03-08Trustindex verifies that the original source of the review is Google. They did a great job arranging our mortgage. Very supportive and talked us through everything very clearly. Polly Alice2025-03-08Trustindex verifies that the original source of the review is Google. Highly recommend the service. Jack was a great help answering any questions I had about the process. Great value for money, and makes the whole process less daunting. Samantha Kilford2025-03-05Trustindex verifies that the original source of the review is Google. I highly recommend Jack and the team at Strive Mortgages. As a first time buyer, I was entirely clueless and Jack has been incredibly helpful at de-mystifying the entire process. Everything has been efficient and as stress-free as possible. A real top-notch advisor, Jack is always available to answer questions and provide expert guidance - I couldn't ask for more! mark slade2025-03-02Trustindex verifies that the original source of the review is Google. Absolutely fantastic. On your side right from the start. I will be recommending Strive Mortgages at every opportunity. Thank uou so much!! H W2025-02-25Trustindex verifies that the original source of the review is Google. Very professional and efficient service that always has your best interests at heart.They set up a WhatsApp group to enable my wife and I to have seamless and rapid communication with the broker on both the mortgage application process and any general queries we had in relation to mortgages.I would highly recommend them to anyone looking to take the stress out of moving. R A2025-02-25Trustindex verifies that the original source of the review is Google. Jamie and his team at Strive Mortgages have been fantastic from start to finish. The process was so smooth and efficient. Jamie was always so easy to get a hold of to answer any queries we had and ensured we were happy and comfortable throughout.Id highly recommend anyone to use Strive Mortgages and will certainly continue to use Strive for all our mortgage needs!
Should I remortgage with my existing lender or move to a new lender?
The decision to stay with your current lender or remortgage with a new lender depends on various factors and individual circumstances. Some key considerations include:
Staying with the same lender
Pros:
- No Affordability Check or Credit Check: Since you are staying with your current lender, they may not require a new affordability check or credit check. This can save you time and effort in providing documentation and undergoing a new application process.
- Potential Discounts for Existing Customers: Some lenders offer loyalty discounts or preferential rates for existing customers. This could result in cost savings compared to switching to a new lender.
- Streamlined and Quicker Process: Staying with your sale lender often involves a more streamlined process since they already have your information and history. This can lead to a quicker turnaround time for renewing your mortgage.
Cons:
- Limited Range of Mortgage Products: Your existing lender may have a limited range of mortgage products available. This can limit your ability to explore other options that may better suit your needs or provide more favourable terms.
- Missed Opportunity for Better Rates: By not shopping around and exploring offers from other lenders, you may miss out on better interest rates or promotional deals available in the market.
- Lack of Flexibility: Your current lender’s policies or terms may not align with your changing financial needs or goals. Switching to a new lender could offer more flexibility in terms of customising your mortgage to suit your specific requirements.
Switching to a New Lender
Pros:
- Potential for Better Rates and Terms: By switching to a new lender, you have the opportunity to explore and compare a wider range of mortgage products. This can potentially result in securing better interest rates and more favourable terms.
- Access to New Promotions or Incentives: New lenders often offer promotions or incentives to attract new customers, such as cashback offers, fee waivers, or discounted rates.
- Enhanced Customisation: Switching to a new lender allows you to align your mortgage with your changing financial goals and needs. You can choose a product that offers the features and flexibility you desire.
Cons:
- Additional Costs: Switching lenders may involve additional costs, including legal fees, valuation fees, and potential early repayment charges from your existing lender. These costs should be factored into your decision-making process.
- Documentation and Process: Switching lenders requires going through the application process again, providing documentation, and meeting the criteria of the new lender. This can be time-consuming and may require additional effort on your part.
- Uncertainty with New Lender: Switching to a new lender means moving away from the familiarity and relationship you have built with your existing lender. There might be a period of adjustment and uncertainty as you establish a new relationship with the new lender.
Talk to a mortgage expert today, to lock you in with the best deal.
What products are available when your fixed rate ends?
When your fixed-rate mortgage ends, you have several options available for selecting a new mortgage product. The specific products that are available can vary depending on the lender and the current market conditions.
However, some common options include:
- Fixed-Rate Mortgages: Fixed-rate mortgages allow you to lock in an interest rate for a specified period, typically 2, 3, 5, 7, or 10 years. These mortgages provide stability and predictable payments during the fixed-rate term.
- Tracker Mortgages: Tracker mortgages are tied to a specified benchmark rate, such as the Bank of England base rate or the LIBOR (London Interbank Offered Rate). The interest rate on a tracker mortgage moves in line with the benchmark rate, plus a set margin.
- Variable Rate Mortgages: Variable rate mortgages have interest rates that can fluctuate over time. These rates are typically influenced by the lender’s standard variable rate (SVR), which can change based on market conditions and the lender’s discretion.
- Discounted Rate Mortgages: Discounted rate mortgages offer a discounted interest rate off the lender’s SVR for a specific period. After the discounted period ends, the rate typically reverts to the lender’s SVR.
- Offset Mortgages: Offset mortgages link your savings or current account balances to your mortgage balance. The interest you pay is calculated on the difference between your mortgage balance and the combined balance in your linked accounts. This can help reduce the amount of interest you pay over time.
What are the costs of remortgaging?
When considering the costs of remortgaging, it can vary depending on whether you stay with the same lender or switch to a new lender. Here are some potential costs associated with remortgaging:
Same Lender (Product Transfer):
- Product Transfer Fee: Some lenders may charge a fee for switching to a new mortgage product with them. This fee can vary but is generally lower compared to fees associated with switching lenders.
New Lender (Remortgaging):
- Valuation Fee: If you switch to a new lender, they may require a valuation of the property to determine its current market value. Valuation fees can vary depending on the property size and location.
- Conveyancing Fees: These fees cover the legal work involved in transferring the mortgage from one lender to another. They can include solicitor or conveyancer charges, land registry fees, and search fees. Some lenders may offer to cover some or all of these fees as an incentive to attract new customers.
- Arrangement Fees: Some mortgage products, especially those with lower interest rates or additional features, may come with arrangement fees. These fees are usually paid upfront and can vary in amount.
- Early Repayment Charges (ERCs): If you remortgage before the end of your current mortgage term, you may be subject to ERCs from your existing lender. These charges are meant to compensate the lender for the interest they would have earned if you had stayed with them for the full term.
For more information on fixed-rate mortgages, please contact a member of the Strive team, by emailing [email protected] or call us on 01273 002697.
Strive Mortgages saves you time, hassle & money
Jamie Elvin
Jamie is an expert in all things mortgages, and our most experienced broker. Connect with Jamie and get started to see how Strive Mortgages can help you.