Around 1.8 million fixed-rate mortgages are set to expire this year, leaving many households facing a significant jump in monthly costs if their rate increases. UK mortgage rates have climbed in recent months, adding pressure on homeowners.
The average interest rate on a five-year fixed mortgage hit 6% earlier this month, according to comparison website Moneyfacts, though it has since dipped slightly to 5.99%. The average two-year fixed mortgage is only marginally lower at 5.96%.
This includes almost 750,000 borrowers coming off older, cheaper fixed rates taken out up to five years ago. For those planning to lock into a new deal, the key question is how long to fix for.
Why Have Mortgage Rates Gone Up?
The cost of home loans has been rising due to concerns over interest rates and government borrowing costs. At the start of this year, the Bank of England had been expected to cut interest rates at some point in 2026, but the Iran war has pushed prices and inflation up, meaning rate cuts have not happened.
The base rate has been paused at 3.75% since December 2025. Meanwhile, higher inflation saw UK government borrowing reach £18.3 billion in August 2026, which is £2.9 billion higher compared to the previous year.
Increased government borrowing leads to higher mortgage rates because it pushes up bond yields, which in turn tends to raise swap rates. Swap rates are the interest rates that banks charge each other for borrowing, so they impact the pricing of fixed-term mortgages.
How Long Should You Fix Your Mortgage For?
Rachel Geddes, Strategic Lender Relationship Director at Mortgage Advice Bureau, says there is no one-size-fits-all answer to whether a two or five-year fix is better. The right choice depends on personal circumstances, rather than trying to predict where interest rates are heading.
She said: "A five-year fix gives you certainty over your biggest monthly outgoing for longer, which many borrowers value, particularly those on a tight budget or anyone who wants protection against future rate rises."
"A two-year fix offers more flexibility, which can suit people who expect their circumstances to change, such as a pay rise, a move or a growing family, or those who think rates may come down and want the chance to remortgage sooner."
"Longer fixes - such as 10 years - are also available, and can appeal to those who value stability above all else, but it’s important to weigh that against the potential cost of an early repayment charge, should your circumstances change."
How to Remortgage
You can normally start looking for a new mortgage deal three to six months before your current one expires. Start by using an online comparison tool, or by speaking to a mortgage broker, as they often have access to deals not available on the open market.
You should also speak to your current lender to see what rates it can offer you. This is known as a product transfer, where you get a new deal from the same lender.
When looking for a new deal, it is important to gather all relevant information about your existing deal, such as the rate you are on and your loan to value (LTV), which is the amount you are borrowing compared to the property's value. As well as the rate you are offered, you should also consider any product fees, early repayment charges, and whether the mortgage can be ported to a new property.
