Why you could save thousands by fixing your mortgage now

Fixed rate mortgages continue to be really cheap, so take a look at what you might be able to save by switching.

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Why you could save thousands by fixing your mortgage now
Fixed rate mortgages are very popular, and it's easy to understand why. They provide you with certainty – you know that for the length of your fixed rate period, your repayments will remain exactly the same each month, no matter what the Bank of England does with the Base Rate.

But even with the threat of a Base Rate rise, mortgage rates are continuing to fall, according to findings from Moneyfacts.

However, knowing that you want to fix your mortgage rate is only half the decision. You need to work out how long you want to fix for too.

Two-year fixed rate mortgages are the cheapest, but you only have certainty about your mortgage payments for a short period of time. If you want the added security of a five-year fixed rate, you'll pay a premium in the form of a higher interest rate. Long-term fixed rates also come with much higher Early Repayment Charges, so you might need to take that into account too.

Top two-year fixed rate mortgages

First, let's look at the two-year fixed rate mortgages with the lowest rates around. Be warned, nabbing a tiny interest rate usually means you'll have a stump up a hefty product fee.

Lender

LTV

Interest rate

Product fees

Yorkshire BS

60%

1.17%

£1,475

Yorkshire BS

65%

1.17%

£1,475

HSBC

70%

1.29%

£1,999

HSBC

75%

1.29%

£1,999

The Co-operative Bank

80%

1.49%

£1,499

Post Office Money

85%

1.68%

£1,495

The Co-operative Bank

90%

2.14%

£1,499


As you can see, there are some mammoth fees there. But what if you don't want to stump up a significant product fee? These are the best mortgages with fees under £500.

Lender

LTV

Interest rate

Product fees

Barnsley BS

60%

1.44%

£475

Chelsea BS

65%

1.44%

£475

Chelsea BS

70%

1.64%

£475

Chelsea BS

75%

1.64%

£475

Chelsea BS

80%

1.94%

£475

Chelsea BS

85%

1.94%

£475

Chelsea BS

90%

2.59%

£475

Three-year fixed rate mortgages

If you want certainty about your mortgage repayments for a little bit longer, a three-year fixed rate mortgage may be a better option. First, let's take a look at the deals with the smallest interest rates.

Lender

LTV

Interest rate

Product fees

Post Office Money

60%

1.78%

£1,995

The Co-operative Bank

65%

1.94%

£1,499

The Co-operative Bank

70%

1.94%

£1,499

Post Office Money

75%

1.99%

£1,995

Newcastle BS

80%

2.09%

£999

Platform

85%

2.24%

£1,499

Coventry BS

90%

2.59%

£999

And now let's take a look at the best deals with a fee of under £500.

Lender

LTV

Interest rate

Product fees

Post Office Money

60%

2.18%

£0

Principality BS

65%

2.25%

£99

Hanley Economic BS

70%

2.29%

£250

Hanley Economic BS

75%

2.29%

£250

Hanley Economic BS

80%

2.29%

£250

Leeds Building Society

85%

2.59%

£199

Coventry BS

90%

2.89%

£0

Five-year fixed rate mortgages

If you want to go for a longer-term fixed rate deal, then you may prefer a five-year fixed rate deal. While you enjoy that security for longer, you may have to pay a premium in terms of a higher rate. You also have significant Early Repayment Charges to consider should you wish to leave the deal early.

Lender

LTV

Interest rate

Product fees

HSBC

60%

1.99%

£1,999

HSBC

65%

2.19%

£1,999

HSBC

70%

2.19%

£1,999

HSBC

75%

2.19%

£1,999

First Direct

80%

2.58%

£1,450

Hinckley & Rugby BS

85%

2.79%

£999

HSBC

90%

2.99%

£1,499

And now let's take a look at the best deals with a fee of under £500.

Lender

LTV

Interest rate

Product fees

Cumberland BS

60%

2.44%

£199

Coventry BS

65%

2.54%

£0

Leeds BS

70%

2.65%

£199

Leeds BS

75%

2.65%

£199

Leeds BS

80%

2.74%

£199

Nottingham BS

85%

2.94%

£499

Coventry BS

90%

3.35%

£0

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