Mortgage rates rose sharply in September, leaving you with far fewer deals to choose from as global instability and rising energy costs unsettled the market.
Many major lenders raised rates multiple times, making the once plentiful sub-5 % fixed-rate mortgage now closer and closer to extinction.
Here, Which? explains what’s happening in the mortgage market, how it will impact your monthly repayments and whether more rate hikes are on the way.
What’s happening to mortgage rates?
At the start of January, two-year fixed rate mortgages offered some of the lowest rates on the market. The lowest rates were jut shy of 3.5% and you could choose from 750 mortgages with rates below 4%.
Nine months later, the picture is very different. Just one sub-4 % mortgage is available, and you’ll need to meet strict eligibility criteria to get it. The tracker mortgage is available exclusively to Barclays Premier customers. To qualify as a Premier customer, you must earn a minimum of £75,000 or have at least £100,000 in savings or investments with the bank.
After a relatively calm August, mortgage rates gathered pace in September as concerns grew about rising energy costs and their effect on the wider economy.
At the start of September, more than 1,500 fixed-rate mortgages offered rates below 5%. One month on, that number had plummeted to just 131, according to our analysis of Moneyfacts data.
In the past few days, there has been a glimmer of hope for borrowers, with some lenders starting to drop rates again, but it is not yet clear how long this will last.
The graph below shows how average rates across different mortgage products have changed since the start of the year.
- Find out more: best mortgage rates
Is now the time to choose a tracker mortgage?
Since March, tracker mortgages have offered the cheapest borrowing. With this type of mortgage, the interest rate you pay is based on an external rate, typically the Bank of England base rate, plus a set amount.
For example, if you’re remortgaging, the lowest rate for a two-year fix is around 5%, while the best deal for a two-year tracker is just above 4%.
The table shows the cheapest two-year tracker rates for remortgagers at different loan-to-value ratios.
Table notes: Data from Moneyfacts, updated daily at 1am and 1pm. Customer scores are based on a survey of 6,514 members of the public in August-September 2026 and combine overall satisfaction with likelihood to recommend the provider. The average customer score is 73%. To become a Which? Recommended Provider, a lender must get a customer score above 71%, score at least four stars for customer service, rank among the 10 cheapest mortgage lenders for first-time buyers, home movers and remortgagers and be fully covered by the Financial Conduct Authority banking standards regime. ‘Revert rate’ is the standard variable rate (SVR), which is the mortgage rate you’d be transferred onto when your deal ended if it remained unchanged between now and then.
In 2026, the base rate has remained steady at 3.75%. Last year, the base rate was cut by a whole percentage point. Good news for those with tracker mortgages.
But if you’re thinking of taking out a tracker now, there’s a risk your repayments could rise. Many experts predict the Bank of England to raise the base rate by 0.25 percentage points at its next Monetary Policy Committee meeting in November. Economists at Barclays Research forecast a further increase of 0.25 percentage points in early 2027. That would take the base rate to 4.25% by early next year.
A tracker mortgage could save you money initially compared with a fixed-rate deal, but your monthly repayments would increase if the base rate rises as forecast. You could also face bigger increases if global instability prompts the Bank of England to raise rates further than expected.
Ultimately, anyone choosing a tracker mortgage should make sure they can afford repayments if their interest rate rose by a full percentage point over the next year or so.
How much more could you pay each month?
To show how rate increases can affect your monthly mortgage payments, we’ve set out two scenarios. For each scenario, we show the monthly repayments at three interest rates: 4%, 5%, and 6%.
Monthly repayment figures rounded to the nearest pound.
If you have a £250,000 mortgage with 25 years remaining, the jump from 4% to 5% would add an extra £141 to your monthly repayments, or almost £1,700 a year. The rise from 5% to 6% would cost you slightly more, adding £150 a month.
If you owe £200,000 with 15 years remaining, the increase would be smaller, with each one percentage point rise adding just over £100 to your monthly repayments.
How to find the best mortgage for you
We’ve investigated customer satisfaction and analysed rates to help you choose the right lender for your next mortgage. Our four Which? Recommended Providers all achieved high customer satisfaction scores and consistently offered rates close to the lowest on the market.
When choosing a mortgage deal, the headline rate is important, but don’t overlook upfront fees. Some market-leading rates can come with charges of more than £1,500.
We have found that fee-free deals with slightly higher interest rates can sometimes work out to be less expensive overall. This is why it’s important to consider the cost of the entire mortgage before choosing a deal.
To help you compare costs, you can use the Which? mortgage repayment calculator. It can tell you the monthly repayment and the total cost of the loan, whether you add the fee to your mortgage or pay it up front.
If it’s your first time taking out a mortgage, you may also want to get help from a mortgage broker. A whole-of-market mortgage broker can find a deal that suits your circumstances and help you compare rates and fees to find the best value for money.
- Find out more: choosing a mortgage broker
