If you took advantage of record low mortgage rates two years ago, you need to act fast to avoid a blow for your budget.
Borrowers who got a two-year fixed-rate offer January 2022 secured a typical rate of 2.31%, and have been enjoying relatively low repayments since.
That’s set to change, however, with one of these deals now reaching the end of their introductory terms and being moved to the lender’s standard variable rate (SVR).
And with SVRs currently averaging 4.9% – a five-year high – many homeowners could see their mortgage bills jump by hundreds of pounds a month.
Which? explains you skill if your fixed-rate period is expiring and offers suggestions about the cheapest remortgage deals currently available.
How much is your mortgage bill rising by?
The exact amount your mortgage bill will rise depends on the speed you fixed it at and your lender’s current SVR.
Below, we’ve modeled how your bill could increase, based on the average rate of two.31% from two years ago and today’s average SVR of 4.9%.
| Original mortgage debt | Monthly payments now (2.31%) | Monthly payments in February (4.9%) | Rise in monthly payments | Total additional cost over 12 months |
| lb100,000 | lb439 | lb579 | lb140 | lb1,676 |
| lb200,000 | lb878 | lb1,158 | lb279 | lb3,352 |
| lb300,000 | lb1,317 | lb1,736 | lb419 | lb5,028 |
| lb400,000 | lb1,756 | lb2,315 | lb559 | lb6,704 |
| lb500,000 | lb2,196 | lb2,894 | lb698 | lb8,380 |
To figure out the precise impact of rate rises, make use of the Which? Mortgage Repayment Calculator. All you’ll require is your current rate as well as your lender's standard variable rate.
How to avoid a mortgage bill shock
You should make sure when the promotional period in your fixed-term deal expires and ensure you have a intend to do not be dumped onto your lender’s SVR.
Your provider should contact you to inform you you are about to revert onto the standard rate, but there’s no need to wait around with this warning, as possible usually secure a brand new deal six months ahead of time.
Once you realize when your mortgage deal ends, you need to see what rate your lender will offer you and shop around to check deals from other providers.
The best two-year fixed-rate remortgage deals
Currently, the average two-year fixed rate mortgage is priced at 2.52%, so you may be unable to look for a deal as low as your original loan.
Nonetheless, following through to secure the best rate is crucial if you wish to keep your mortgage repayments manageable.
Below we've set out the very best two-year fixed-rate remortgage deals currently available across different loan-to-value ratios.
