What experts say the 1.8m people who need a new mortgage deal this year should do now

Remortgage applications have surged as homeowners come off ultra-low pandemic-era fixes and now face higher borrowing costs.

Applications jumped by 46 per cent in the first three months of 2026 compared with a year earlier, according to new data from Stonebridge.

That rise is driving overall mortgage activity, which climbed by a quarter (24.6 per cent) year on year, even as demand for home purchases dipped.

What’s causing the rush?

Behind the spike is the millions of borrowers coming off ultra-low fixed deals taken out during the pandemic.

Back in 2021, mortgage rates fell as low as 1.85 per cent. Today, they remain significantly higher, leaving many households facing a jump in monthly payments.

UK Finance estimates that 1.8 million fixed-rate mortgages are due to end this year, adding to the refinancing wave already underway.

James Tatch, head of analytics at UK Finance, said: “1.8m fixed-rate mortgages are due to come to an end this year, which is driving increased numbers of customers refinancing these deals compared with those seen last year.

“Whilst fixed rates continue to be the overwhelmingly popular choice for mortgage customers, some may choose variable rate deals if they expect the global situation and associated market volatility to subside in the near term, which could allow rates to fall.

“Getting advice from a qualified mortgage advisor is essential if customers are unsure about which product is most suitable for their circumstances.”

Why remortgaging is rising now

The increase is not just about expiring deals. Interest rates had been falling earlier this year, helping to improve affordability and boost confidence.

Average mortgage rates dropped from 4.74 per cent in Q1 2025 to 4.31 per cent in Q1 2026, according to Stonebridge, while remortgage borrowing rose 7.3 per cent year on year.

That has encouraged borrowers to act, particularly those keen to avoid rolling onto expensive standard variable rates.

Rob Clifford, chief executive at Stonebridge, said: “We know many borrowers locked into attractive five-year rates during the pandemic. Now that so many of those consumers are reaching the end of the deals they grabbed at that time, we are naturally seeing huge demand for advice on refinancing options.”

Shorter fixes and tracker deals

One clear trend is the move away from longer fixed deals.

Two-year fixes now account for 65 per cent of mortgages, up from 52 per cent a year ago, while the share of five-year deals has fallen to 29 per cent.

This reflects uncertainty over the path of interest rates, with many borrowers choosing shorter terms in case rates fall further.

Fixed rates still dominate, making up more than 94 per cent of the market. However, tracker deals are attracting more attention.

Part of the appeal is price. The average two-year tracker rate is around 4.63 per cent, compared with 5.87 per cent for a two-year fixed, according to Moneyfacts.

What do the experts say?

David Hollingworth of L&C mortgages said: “The majority of borrowers continue to prefer the certainty of a fixed rate and knowing exactly where they stand when it comes to their monthly mortgage payments.

“However, with the sharp hike to fixed rates there’s more signs that some borrowers are wondering whether an initially lower tracker rate could be cheaper now but also offer a chance to lock in at a later date.”

Tracker mortgages move with the Bank of England base rate, so repayments can rise or fall.

Hollingworth added: “Trackers are far more likely to be available without any early repayment charge at any time which would allow a switch to a fix at a later date.”

Rachel Springall, finance expert at Moneyfactscompare.co.uk, said: “Amid the turmoil we have seen to fixed mortgage rates, borrowers might feel it would be beneficial to take out a tracker mortgage moving forward, but it’s worth seeking advice before applying.

“The most appropriate deal would really come down to the choice of the buyer: do they want peace of mind with a fixed rate deal, or do they feel they are in a good position to go for a tracker mortgage instead?

“If we do end up with a rise to the Bank of England base rate before the year is over, it means higher repayments for tracker mortgage customers.”

What should borrowers do now?

For anyone nearing the end of a deal, preparation is key. Most lenders allow you to secure a new rate up to six months before your current deal ends. This can help protect against future rises while keeping options open if rates fall.

The right choice depends on your circumstances. A fixed rate offers certainty, while a tracker may suit those who can cope with changes in payments.

Clifford said: “We’re likely to see a reversal in rate volatility in the second half of the year and the popularity of variable or tracker rates might increase. If the energy crisis is short lived, a variable product would allow borrowers to capitalise on a falling base rate once the conflict subsides but this is a time when impartial and expert mortgage advice is worth its weight in gold.”

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