Don’t Wait: Why the 6-Month Countdown to Your Fixed Rate Ending is Key

If the fixed rate on your mortgage is ending soon, now’s the time to act!

Waiting until the last minute could mean higher costs, especially in a market where rates are much less predictable. Acting early could save you a lot of money and stress.

Here’s a quick guide to getting the best possible rate, whether you stick with your current lender or explore other options.

The 6-Month Sweet Spot: Your Window of Opportunity

Many lenders will let you "lock in" a new rate up to six months before your fixed-rate term ends. Why is this time frame so valuable?

• Avoid costly standard variable rates (SVRs): These rates can be high, so securing a new fixed rate in time can save you from an unnecessary hike in your monthly payments.
• Lock in a rate now, but with flexibility: Secure today’s best rate, and if rates drop before your new rate kicks in, most lenders will allow you to switch to the lower one.
• Take your time: Reviewing your options early means you can assess any changes in your situation without the last-minute rush. If you're looking to borrow more money for home improvements for example, you can ensure you fully cost the work and borrow enough!
• Stress less: Let’s face it—mortgages can be daunting without adding a time pressure! Planning ahead keeps things smooth and under control.

Your Two Main Options

A mortgage broker can walk you through these choices to find the best fit for you:

Product Transfer (Sticking with Your Lender)

A product transfer is often the simplest choice if you want to stay with your current lender. Here’s how it works:

• Easy process: Lock in a new rate 4–6 months before your current one ends.
• Rate flexibility: Most lenders allow you to switch to a lower rate if one becomes available before your new one starts.
• Minimal paperwork: Usually, no new affordability checks. This can be particularly helpful if your income has dropped or you've changed from employed to self-employed recently and can't evidence your income!

?Remortgage (Switching Lenders)

Remortgaging gives you access to the wider market, which could mean lower rates and terms to fit your current needs. Here’s what to expect:

• Access to competitive rates: Every lender has their own suite of products, so the more lenders available to you, the greater the chance of finding a more competitive rate than with your current lender.
• Secure your new rate in advance - Lock in a new rate 6 months before your current one ends.
• Rate flexibility: Most lenders allow you to switch to a lower rate if one becomes available before your new one starts.
• Tailored options: Switching lenders may offer terms that better suit your lifestyle, career changes, or income adjustments.
• New application needed: This process is likely to take 4–6 weeks for this process and will involve a new assessment of your income, outgoings and overall affordability of the new mortgage.

Multiple Loan Parts

For those of you with multiple loan parts on your current mortgage, timing can get a bit more complex.

Here’s what to consider:

• Staggered fixed rates: If one loan part is ending soon and others aren’t, you may want a product transfer for just that part. This way, you avoid the higher SVR on that part without disrupting the rest.
• Strategic alignment: You could look to align your fixed-rate end dates for future simplicity. For example: If one loan part has two years remaining, a two-year fixed rate for the expiring part to could then match both end dates. Or, if only a few months remain on one part, you might choose an "interim" rate with no early repayment penalties, then combine all parts under a single new rate when they’re both ready.

Aligning loan parts makes managing your mortgage much simpler and opens up options to switch lenders for potentially better rates in the future.

In Summary

The six-month window before your fixed rate ends is your opportunity to lock in the most competitive rate available to you, avoid jumping onto a higher SVR, and stay calm that it's under control.

While rates have recently shown some downward movement, they’re still unpredictable. External factors like inflation, economic updates, or even global events can quickly push them up again.

Whether you end up opting for a product transfer or remortgage, getting help from a broker and acting early means you’re in control. Taking a little time now can make a big difference in the rates and options available to you.

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Your home may be repossessed if you don't keep up with your mortgage payments.

This article doesn’t constitute advice - your situation and requirements are unique and therefore you should seek expert advice based on your own individual circumstances.

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?About Me

I'm Mark Humphrey, founder and Advisor at MHC Mortgage & Protection Ltd, a mortgage broker firm based in Whitstable and helping people buy their homes across the UK.

I've worked in Mortgages for over 20 years and am passionate about making the mortgage and moving process as simple and stress-free as possible.

Buying your home is a BIG DEAL and with a bit more understanding and help along the way - it really can be such a positive experience and not the stressful and anxious time that so many people dread!