A fixed-rate mortgage deal means that you will agree a set amount to pay back to the lender each month, at a pre-arranged rate of interest. Unlike other mortgage types where your monthly repayments are dependent on the Bank of England base rate, you would know exactly how much you had to pay back each month and could therefore budget accordingly. A fixed-rate mortgage is a suitable choice for those who do not like to introduce too much risk into their borrowing.
Indeed, with the base rate currently at an all-time low, it is widely accepted that a price increase for fixed-rate mortgage deals is imminent. For lenders, the cost of funding fixed-rate lending (known as the ‘SWAP rate’) will also be on the rise, and the increase will be passed on to consumers. Therefore, it may be advisable to act now if you want to secure a competitive deal on a fixed-rate mortgage. If you would like to talk through your options with a qualified mortgage advisor, please fill out our short form and an advisor from the SimplyFinance network will be in touch with you shortly.