Fixed Rate Mortgage
A fixed Rate mortgage as you can imagine is a mortgage which has its rate fixed for a certain period of time.
As a result a fixed rate mortgage gives you stability with your monthly outgoings as you know exactly how much you are paying on a monthly basis.
Fixed rate mortgage deals as usually popular with first time buyers as it gives reassurance to sort out finances with the option to overpay if you find that you can (subject to the specific terms or your mortgage deal.
The most common terms for a fixed rate mortgage are:
- 2 year Fixed rate mortgage
- 3 year Fixed rate mortgage
- 5 year fixed rate mortgage
Some lenders will offer a 10 year fixed rate mortgage, however the longer the term usually the higher the interest.
A fixed rate mortgage usually has an arrangement fee this differs from lender to lender and between fixed rate mortgage terms, If you do not have the funds available to pay this upfront your lender will normally allow for this to be added to the balance of the mortgage providing this does not push you beyond the maximum permitted loan to value for the mortgage.
With a fixed rate mortgage you will find that you are tied into the mortgage (usually only for the fixed term) with an early repayment charge. In the event that you decide to pull out of your mortgage for any reason (most common reasons are sale of property without transferring mortgage to new property, or remortgage due to better available rates) you will have to pay the charge. this is normally higher for a longer term fixed rate mortgage.
Thinking of pulling out of your fixed rate mortgage, let us do the maths and advise you.
Amber Mortgage Solutions invite you to contact us on 01702 619 221 We are able to calculate the benefits for you and advise whether it is worthwhile remortgaging now or waiting. Alternatively you are welcome to use our convenient enquiry form and we will respond to your questions promptly.
After your fixed rate mortgage term has expired you will normally switch to the standard variable rate for your particular lender, we would highly recommend that you contact us three months before your fixed rate expires to enable us to arrange your new mortgage for you 01702 619 221 if you have used us before we will contact you in plenty of time as a reminder.