Around 1.8 million fixed-rate mortgages are set to expire this year, meaning many households will be facing a big jump in their monthly costs if their rate goes up
Mortgage rates have climbed since the US and Israel began strikes on Iran
UK mortgage rates have soared in recent months, putting more pressure on already struggling homeowners.
The average interest rate on a five-year fixed mortgage hit 6% earlier this month, according to comparison website Moneyfacts, though it has dipped slightly now to 5.99%. The average two-year fixed mortgage is only a touch lower at 5.96%.
Around 1.8 million fixed-rate mortgages are set to expire this year, meaning many households will be facing a big jump in their monthly costs if their rate goes up.
This includes almost 750,000 borrowers are coming off older, cheap fixed rates that were taken out up to five years ago. But if you plan on locking into a new deal, just how long should you consider fixing for? We have asked a mortgage expert to find out their opinion.
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Different types of mortgages explained
Tracker mortgage: If you have a tracker mortgage, then this follows the movement of the base rate. It means when the base rate goes up, so do your monthly payments – but if it goes down, your bill gets cheaper.
SVR mortgage: If you have a standard variable rate (SVR) mortgage, then it is down to your mortgage lender to decide if they pass on any base rate changes. On the whole, most do make changes in line with the base rate.
Fixed mortgage: If you have a fixed rate mortgage, you have agreed to pay a fixed amount every month for a set period of time. This means your payments are not affected by the base rate and won’t change until your fixed deal has ended.
Why have mortgage rates gone up?
The cost of home loans has been rising due to worries over interest rates going up and government borrowing costs. At the start of this year, the Bank of England had been expected to cut interest rates at some point in 2026 – but the Iran war has sent prices and inflation going up, meaning rate cuts have not happened.
Changes to the Bank of England base rate can directly affect how much you pay on a mortgage. If you have a tracker mortgage, this follows changes to the base rate – while banks price fixed rate mortgages based on expectations for future base rate changes.
The base rate has been paused at 3.75% since December 2025. Meanwhile, higher inflation saw UK government borrowing reach £18.3billion in August 2026 – which is £2.9billion higher compared to the previous year.
Increased government borrowing leads to higher mortgage rates because it pushes up bond yields – when this happens, swap rates tend to go up as well. Swap rates are the interest rates that banks charge each other for borrowing, so they have an impact on the pricing of fixed term mortgages.
How long should you fix your mortgage for?
Rachel Geddes, Strategic Lender Relationship Director at Mortgage Advice Bureau says there is no one-size-fits-all answer to whether a two or five-year fix is better.
The right choice depends on your personal circumstances, rather than on trying to predict where interest rates are heading. Speaking to a mortgage adviser, who can compare deals across the market and look at your plans for the next few years, can help you choose the right option for you.
She said: “A five-year fix gives you certainty over your biggest monthly outgoing for longer, which many borrowers value, particularly those on a tight budget or anyone who wants protection against future rate rises.
“A two-year fix offers more flexibility, which can suit people who expect their circumstances to change, such as a pay rise, a move or a growing family, or those who think rates may come down and want the chance to remortgage sooner.
“Longer fixes – such as 10 years – are also available, and can appeal to those who value stability above all else, but it’s important to weigh that against the potential cost of an early repayment charge, should your circumstances change.”
How to remortgage
You can normally start looking for a new mortgage deal three to six months before your current one expires.
Start by using an online comparison tool, or by speaking to a mortgage broker, as they will often have access to deals that aren’t available on the open market.
You should also speak to your current lender to see what rates it can offer you. This is known as a product transfers, which is where you get a new deal from the same lender.
When looking for a new deal, it is important to get all the relevant information about your existing deal – such as the rate you are on and your loan to value (LTV). This is the amount you are borrowing compared to the property’s value.
As well as the rate you are offered, you should also take into account any product fees, early repayment charges, and whether the mortgage can be ported to a new property.
