What Happens at the End of a Fixed Mortgage Deal?
If you’re coming to the end of your fixed mortgage deal, it’s important to know what your options are and what to expect next.
A fixed mortgage offers peace of mind with set payments for an agreed period usually 2, 3, 5, or 10 years but that fixed period doesn’t last forever.
When your fixed mortgage deal ends, your mortgage does not automatically finish. You still owe the remaining balance, but your interest rate and monthly payments may change depending on what you do next.
In this guide, we’ll explain what happens at the end of a fixed mortgage deal, what the Standard Variable Rate means, and what options you may want to consider for your residential mortgage or buy-to-let mortgage.
What Is a Fixed Mortgage Deal?
A fixed mortgage deal means your interest rate stays the same for a set period.
This can make budgeting easier because your monthly mortgage payments usually remain the same during the fixed-rate period.
Fixed mortgage deals are commonly available for:
- Residential mortgages
- Buy-to-let mortgages
- First-time buyer mortgages
- Remortgage applications
- Home mover mortgages
The most common fixed mortgage terms are usually:
- 2-year fixed mortgage deals
- 3-year fixed mortgage deals
- 5-year fixed mortgage deals
- 10-year fixed mortgage deals
Fixed deals can apply to both residential mortgages and buy-to-let mortgages. However, the available rates, fees, lender criteria and affordability checks may differ depending on the type of mortgage.
What Happens When Your Fixed Mortgage Deal Ends?
When your fixed mortgage deal comes to an end, your mortgage continues.
The key change is that your fixed interest rate ends. Unless you arrange a new mortgage deal, your lender will usually move you onto their Standard Variable Rate, often known as the SVR.
This is why it is important to review your mortgage options before your fixed deal ends.
You Usually Move onto the Lender’s Standard Variable Rate
If you do not switch to a new mortgage deal or remortgage, your mortgage will typically move onto your lender’s Standard Variable Rate.
What Is the Standard Variable Rate?
The Standard Variable Rate is a variable interest rate set by your mortgage lender.
It is not the same as the Bank of England base rate, although lenders may consider wider market conditions when setting or changing it.
The SVR can go up or down at any time, which means your monthly mortgage payments may increase or decrease.
Why Is the SVR Important?
The Standard Variable Rate is often higher than fixed mortgage rates or other product rates available in the market.
This means that if you stay on the SVR after your fixed mortgage deal ends, you could end up paying more each month.
Example
Sarah fixed her mortgage at 2.5% for five years.
When her fixed mortgage deal ended, she did not switch to a new deal and moved onto her lender’s Standard Variable Rate of 4.5%.
Her monthly mortgage payments increased by £120, which became a big surprise in her monthly budget.
Your Options at the End of a Fixed Mortgage Deal
You do not have to automatically stay on your lender’s Standard Variable Rate.
At the end of your fixed mortgage deal, you may have several options depending on your circumstances, lender criteria and mortgage type.
| Option | What It Means | Why You Might Consider It |
|---|---|---|
| Switch to a new fixed-rate deal | You agree a new fixed interest rate for another set period | Helps keep monthly payments predictable |
| Switch to a tracker mortgage | Your rate follows the Bank of England base rate plus a set percentage | May suit borrowers comfortable with payment changes |
| Remortgage to another lender | You move your mortgage to a different lender | Could help you access different rates, terms or features |
| Stay on the SVR | You do nothing and move onto the lender’s Standard Variable Rate | May offer flexibility, but payments could be higher |
| Overpay your mortgage | You pay more than your required monthly payment | Could reduce the mortgage balance and interest over time |
1. Switch to a New Fixed or Tracker Mortgage Deal
One option is to switch to a new mortgage deal.
This could be with your current lender or with a different lender.
You may be able to choose between:
- A new fixed-rate mortgage deal
- A tracker mortgage deal
- A variable mortgage deal
- A product transfer with your current lender
- A remortgage with another lender
Fixed-Rate Mortgage
A fixed-rate mortgage allows you to lock in your interest rate for another set period.
This can help if you want stability and predictable monthly payments.
Tracker Mortgage
A tracker mortgage follows the Bank of England base rate plus a set percentage.
This means your monthly mortgage payments can change if the base rate changes.
Example
James’s 3-year fixed mortgage deal ended.
Rather than moving onto his lender’s SVR at 4.3%, he switched to a 5-year fixed deal at 2.9%.
This helped him keep his payments more stable.
2. Remortgage to Another Lender
Remortgaging means replacing your current mortgage with a new mortgage, usually from a different lender.
Many homeowners and landlords consider remortgaging when their fixed mortgage deal is coming to an end.
You may consider remortgaging if you want to:
- Look for a more suitable mortgage rate
- Change your mortgage term
- Switch from one mortgage type to another
- Review your monthly payments
- Borrow additional funds, subject to lender criteria
- Move from a residential mortgage to another suitable product
- Review your buy-to-let mortgage options
Remortgaging can involve fees, valuation checks, legal work and lender affordability checks.
That is why it is important to compare the overall cost, not just the interest rate.
3. Overpay Your Mortgage
If your finances allow, you may choose to overpay your mortgage.
Overpaying can reduce the amount of capital you owe, which may reduce the interest you pay over time.
Some borrowers use the end of a fixed mortgage deal as a good time to review overpayment options.
However, you should always check your mortgage terms first, as some lenders have limits on how much you can overpay without charges.
Things to Consider When Your Fixed Mortgage Deal Ends
The end of a fixed mortgage deal is a good time to review your full mortgage position.
Before making a decision, consider the following points.
Early Preparation Is Key
Your lender will usually contact you before your fixed mortgage deal ends.
This may be around 3 to 6 months before the end date.
They may offer you new mortgage deals or explain what happens if you move onto their Standard Variable Rate.
Use this time to:
- Check when your fixed mortgage deal ends
- Compare new mortgage deals
- Review your current interest rate
- Check your lender’s Standard Variable Rate
- Speak to a mortgage adviser
- Review your income, expenses and financial plans
- Check whether your circumstances have changed
- Compare product fees and overall mortgage costs
Preparing early can help you avoid rushing into a decision.
Check for Early Repayment Charges
Some fixed mortgage deals have Early Repayment Charges, known as ERCs.
An Early Repayment Charge may apply if you leave your fixed mortgage deal before the end date.
In many cases, these charges reduce or end once the fixed-rate period finishes.
However, you should always check your mortgage offer or speak to your lender before making changes.
Important things to check include:
- Your fixed deal end date
- Any Early Repayment Charges
- Product fees
- Exit fees
- Valuation fees
- Legal fees
- Overpayment limits
Consider Your Personal Circumstances
Your mortgage options may depend on your personal and financial circumstances.
Before choosing a new mortgage deal, think about:
- Is your income stable?
- Have your monthly expenses changed?
- Has your credit profile changed?
- Are you planning to move home soon?
- Do you want payment certainty?
- Are you comfortable with variable payments?
- Do you need flexibility?
- Are you planning to overpay?
- Is the property residential or buy-to-let?
For buy-to-let landlords, rental income, property value, tax position, lender stress testing and market conditions may also affect the options available.
Fixed Mortgage Deal Ending: Residential vs Buy-to-Let
Residential mortgages and buy-to-let mortgages can both have fixed-rate deals, but the lender criteria may be different.
| Mortgage Type | What to Review at the End of the Fixed Deal |
|---|---|
| Residential mortgage | Income, affordability, credit profile, mortgage term, monthly payments and future plans |
| Buy-to-let mortgage | Rental income, property value, stress testing, landlord costs, tax position and lender criteria |
| First-time buyer mortgage | Future affordability, payment changes and whether switching options are available |
| Remortgage | Overall cost, product fees, rate options and whether another lender may be suitable |
Real-Life Example: Emma’s Fixed Deal Ends
Emma took a five-year fixed mortgage for her residential property with an interest rate of 2.7%.
As the end of her fixed mortgage deal approached, she received letters from her lender offering their Standard Variable Rate and some new fixed mortgage deals.
Emma spoke with a mortgage adviser at BSL Financials, who helped her:
- Understand the potential increase if she stayed on the SVR
- Compare fixed mortgage deals from other lenders
- Review whether a remortgage could be suitable
- Calculate any fees involved in switching
- Consider payment certainty for the next few years
Emma decided to switch to a 5-year fixed mortgage deal with a different lender at 3.0%.
This helped her avoid moving onto the SVR and gave her more certainty over her monthly mortgage payments for the next five years.
Why It Pays to Get Support from Mortgage Experts
Navigating the end of a fixed mortgage deal can feel complicated.
You may need to compare rates, fees, lender criteria, mortgage types and your long-term plans.
That is where BSL Financials can help.
Our mortgage experts keep up to date with mortgage deals and market changes across residential and buy-to-let mortgages.
BSL Financials can help you:
- Understand your existing mortgage terms
- Check when your fixed mortgage deal ends
- Review your current mortgage rate
- Explain what the Standard Variable Rate could mean
- Compare fixed-rate mortgage options
- Compare tracker mortgage options
- Review remortgage opportunities
- Explain possible fees and charges
- Understand options for residential and buy-to-let mortgages
Key Takeaways
When your fixed mortgage deal ends, your mortgage does not end.
The fixed interest rate ends, and unless you take action, your mortgage will usually move onto your lender’s Standard Variable Rate.
This could mean higher monthly mortgage payments.
Before your fixed mortgage deal ends, it is worth reviewing your options early.
You may be able to:
- Switch to a new fixed-rate mortgage deal
- Move to a tracker mortgage
- Remortgage to another lender
- Overpay your mortgage
- Stay on the SVR if flexibility is more important
- Review your buy-to-let mortgage options
The right option depends on your circumstances, mortgage balance, income, future plans and lender criteria.
Final Thoughts
The end of your fixed mortgage deal is an important mortgage milestone.
Without action, your mortgage will typically switch to your lender’s Standard Variable Rate, which is often a higher and variable rate.
However, you may have options.
You could switch to a new fixed mortgage deal, consider a tracker mortgage, remortgage to another lender or review overpayment options.
Planning ahead gives you more control over your mortgage payments and your financial future.
If your fixed mortgage deal is coming to an end, speak to BSL Financials and explore your mortgage options before your current deal finishes.
Contact BSL Financials Today
Is your fixed mortgage deal ending soon?
Contact BSL Financials today to review your mortgage options and take control of your next step.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Information is for general guidance only and does not constitute personal financial advice. Mortgage options are subject to eligibility, affordability checks, lender criteria and status.
