Fixed-rate mortgages have become a popular option for UK homeowners. In this guide, we are going to be rounding up the pros and cons of having a fixed-rate mortgage. 

Pros of a fixed-rate mortgage.

If you opt for a fixed rate, you will have a clear idea of how much money you will be required to pay each month. This can significantly help when you are budgeting your money each month.

Perfect for those looking for reassurance that the monthly repayments won’t drastically rise if the interest rate increases. 

To reduce the cost of your mortgage overall, see if the interest rates are low when you are looking to take your mortgage out. If they are low, a fixed deal will let you, for a period of time, to lock in a more inexpensive rate.

A fixed-rate mortgage will protect you if interest rates were to suddenly spike when you don’t expect it. 

Cons of a fixed-rate mortgage

At times it can be extremely difficult to predict when interest rates will rise and fall.

With a fixed-rate mortgage, you can’t opt for cheaper deals due to your fixed-term contract. This could result in you paying more for your service than necessary if the interest rates decrease.

If there is a reason that you may want to leave your deal early, you are usually required to pay an early repayment charge. This is a fee that is paid to your mortgage lender if you want to reduce the amount of money you have borrowed. 

You will often be charged higher arrangement fees for a fixed-rate mortgage than if you were to choose a variable-rate, so we highly recommend doing some research and calculations to make sure that you are choosing the correct rate for your situation.

If you’re currently looking to put your property on the market, are searching for the perfect new home, or just wish to get some more information from the best estate agents Manchester has to offer, get in touch with our expert team here at Philip Ellis Estate and Lettings Whitefield.