What Is a Fixed-Rate Mortgage?

With a fixed-rate mortgage, your interest rate is locked in for a set period (typically 2, 3, 5 or 10 years) before reverting to your lender's standard variable rate or a new deal. This means your monthly payments stay predictable for the length of the fix, making it easier to budget even if wider interest rates rise.

Once the fixed term ends, you'll usually move onto a more expensive rate unless you remortgage or switch to a new deal, so it's worth thinking ahead about what happens next.

Fixed-Rate Mortgage Costs and Fees

As well as the deposit and mortgage payments, there are additional costs to consider when investing in a rental property. Understanding these expenses can help you plan your investment more effectively.
Cost What is it? What to Consider
Deposit The upfront amount you contribute towards the property purchase. A larger deposit can often unlock lower fixed rates..
Mortgage arrangement fee A fee charged by some lenders to set up the mortgage. This can sometimes be added to the loan rather than paid upfront, so check how this affects the total cost.
Early repayment charge (ERC) A charge for leaving or overpaying beyond your allowance during the fixed term. Fixed deals often carry stricter ERCs than variable ones, so check the terms before committing.
Valuation fees A lender assessment of the property’s value. Some fixed-rate products include a free valuation as part of the deal.
Legal fees Costs for handling the legal side of buying the property. These may include conveyancing, property searches and other legal work.
Booking fee A fee to reserve a specific fixed-rate deal. Not all lenders charge this, so it's worth comparing the overall cost, not just the rate.

Calculate Fixed-Rate Mortgage Costs

Understanding your potential mortgage costs can help you plan your property investment. Use our mortgage calculator to explore possible repayments and get a clearer idea of how different mortgage amounts may affect your budget.

Disclaimer:

Think carefully before securing other debts against your home. Your home or property may be repossessed if you do not keep up repayments on your mortgage. The content on this page is for general information purposes only and should not be considered financial, legal or mortgage advice. It does not take into account your individual circumstances, and you should seek independent professional advice before making any financial decisions.

We work with L&C, a fee free mortgage broker. If you complete on a mortgage through L&C, L&C will be paid a commission by the chosen lender. L&C will share a percentage of this commission with CreditKnowledge. The commission L&C receives doesn't affect the product or rate recommended to you. Our role is to connect you with their service to help you compare mortgage deals and find suitable home loan rates.

London & Country Mortgages Ltd, Unit 26 (2.06), Newark Works, 2 Foundry Lane, Bath, BA2 3GZ is a company limited by shares. L&C’s Companies House number is 1988608. L&C are also authorised and regulated by the Financial Conduct Authority. L&C’s FCA number is 143002. The FCA does not regulate most Buy to Let mortgages.