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Writer's pictureRichard Jennings

What Happens When Your Fixed-Rate Mortgage Ends?

If you’re approaching the end of your fixed-rate mortgage term, you might be wondering, what happens next? Whether you’re a first-time homeowner or a seasoned property owner, it’s essential to understand your options and take action to avoid unnecessary costs. Here’s a clear breakdown of what happens when your fixed rate ends and what steps you can take to secure the best deal.

 

What Is a Fixed-Rate Mortgage?

A fixed-rate mortgage means the interest rate you pay on your loan stays the same for a set period – typically 2, 3, 5, or 10 years. During this time, your monthly repayments remain predictable, regardless of changes in the wider economy or base interest rates.

Once the fixed term ends, the situation changes, and you could face an increase in costs if you don’t act quickly.

 

What Happens at the End of a Fixed Term?

When your fixed-rate mortgage comes to an end, your lender will automatically switch you to their Standard Variable Rate (SVR). Here’s what you need to know about the SVR:

  1. Higher Interest Rates: The SVR is usually higher than the rate you were paying during your fixed term. This means your monthly repayments could increase significantly.

  2. Unpredictable Rates: The SVR can go up or down at any time, depending on the lender’s decisions and changes to the Bank of England base rate.

  3. No Fixed Period: Unlike a fixed-rate mortgage, the SVR has no set term, which means your payments remain uncertain for as long as you’re on this rate.

For example: If your fixed-rate deal was 2% and your lender’s SVR is 5.5%, your monthly repayments could increase by hundreds of pounds.

 

How to Avoid Paying the SVR

To avoid being moved to your lender’s Standard Variable Rate, it’s important to explore your options before your fixed rate ends. Here are the key steps you can take:

1. Remortgage to a New Deal

Remortgaging simply means switching to a new mortgage deal – either with your current lender or a new one. This can help you secure a lower interest rate and keep your repayments affordable.

  • Fixed-Rate Deals: Lock in a new fixed rate to maintain stability.

  • Tracker Mortgages: Consider a tracker mortgage, which follows the Bank of England base rate.

It’s a good idea to start looking 4–6 months before your deal ends to ensure a smooth transition.

 

2. Speak to a Mortgage Broker

Navigating the mortgage market can feel overwhelming, especially with so many deals available. A local mortgage broker (like us at Richard Jennings Mortgage Services!) can:

  • Search the market for the best mortgage deals tailored to your circumstances.

  • Compare rates from multiple lenders, including exclusive deals not available directly to the public.

  • Handle the paperwork and guide you through the remortgage process.

Working with a broker saves you time, stress, and potentially thousands of pounds over the life of your mortgage.

 

3. Consider a Product Transfer

If you’re happy with your current lender, you can ask to switch to a new deal with them. This is known as a product transfer. It’s usually quicker and involves less paperwork, but it’s still worth comparing other lenders’ rates to ensure you’re getting the best deal.

 

Why You Should Act Early

Failing to act before your fixed-rate mortgage ends can result in significant financial consequences:

  • Increased Payments: You could end up paying far more each month on the SVR.

  • Limited Time to Switch: Acting early gives you time to shop around and secure a competitive rate.

  • Stress-Free Transition: By planning ahead, you avoid last-minute panic and ensure a seamless switch to a new mortgage deal.


Person considering different mortgage options

How We Can Help

At Richard Jennings Mortgage Services, we specialise in helping homeowners in Dumfries and across the UK find the right mortgage solution. Whether you’re looking to remortgage, switch lenders, or explore new deals, our award-winning service ensures you get the best possible advice and rates.

We’ll:✅ Review your current mortgage and financial situation.✅ Search the market for the most competitive deals.✅ Manage the process from start to finish, making it simple and stress-free.

 

Don’t Wait – Act Today

If your fixed-rate mortgage is coming to an end, don’t delay. The sooner you start exploring your options, the more money you’ll save in the long run.

Contact us today for personalised advice and let us help you secure your next great mortgage deal.

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