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Comparing the best mortgage rates on the market can be a great way to research your borrowing options. We list some of the options and explain why you also need to consider other factors.
What is the best rate for remortgage borrowers?
According to Mortgage Advice Bureau, below are the best rates for fixed and variable mortgages. All rates are based on someone borrowing £150,000 on a £250,000 mortgage. Danske Bank’s rates are only available through Mortgage Advice Bureau.
What is the best rate for moving home?
According to Mortgage Advice Bureau, below are the best rates for fixed mortgages as of October 6th. All rates are based on someone borrowing £150,000 on a £250,000 mortgage. Danske Bank’s rates are only available through Mortgage Advice Bureau.
What is the best rate for first time buyers?
According to Mortgage Advice Bureau, below are the best rates for fixed mortgages as of September 29th. All rates are based on someone borrowing £180,000 on a £200,000 mortgage. Danske Bank’s rates are only available through Mortgage Advice Bureau.
If you only have enough for a 5% deposit, the best rates are:
What are the different types of mortgages?
The types of mortgage you go for determines how much you will pay. They include:
Fixed-rate mortgages
With fixed rate mortgages have a set interest rate on your home loan for an agreed period, normally two years or five years. You can also get three-year, seven-year and 10-year fixed rate deals.
This means your monthly repayments will stay the same until the end of the fixed term. At this point, if you don’t remortgage onto another fixed rate or tracker deal (see below), you will be automatically moved onto your lender’s standard variable rate (SVR).
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Tracker mortgages
A tracker mortgage has an interest rate that changes in tandem with Bank of England’s base rate. The Bank meets regularly to decide whether the base rate should be kept the same, raised or lowered, depending on the state of the economy.
This means that your monthly repayments will vary too.
The interest rate on tracker mortgages is normally the Bank of England’s base rate plus an extra %. For example the rate might be 4% (the base rate) plus 1% – so you will pay 5.25%.
It might seem like a good idea to go for a tracker mortgage if you think that the Bank is going to cut the base rate significantly, but bear in mind that they normally have a ‘collar’ or ‘floor’ which ensures that the interest rate you pay does not go below a certain level.
Tracker mortgages run for an agreed length of time – often two years – and after this the rate changes to the lender’s SVR, unless you remortgage onto another tracker or fixed-rate deal.
Variable rate mortgages
This is where the interest rate can change, but it’s based on the lender’s own figures rather than the Bank of England’s base rate, as with a tracker mortgage.
Standard variable rate
Every lender has a standard variable rate (SVR) which is the interest rate that mortgages go onto, once a borrower’s fixed-rate or introductory period comes to an end.
The SVR is normally much higher than interest rates you will find on fixed-rate mortgages. For example, at the start of 2025 many lenders had SVRs of 8% and some were as high as 9%.
Discount variable rate
This is where the interest rate you are charged for your home loan is an agreed percentage below the lender’s SVR, for a period of time.
Because the lender can change their SVR whenever they like, this also means your mortgage rate can vary, which will change your monthly repayments.
For example, if the discount rate is 4% for two years and the lender’s SVR is 8.19% when you take the mortgage out, you will pay 4.19% interest. If the lender raised their SVR to 8.36%, your discount variable rate would change to 4.36%.
These mortgages also run for an agreed period, say two years, after which you will be moved onto the SVR unless you remortgage onto a different product.
Speak to our preferred brokers, Mortgage Advice Bureau, to find the right mortgage for you
How can I get the best mortgage rate?
While it’s impossible to control all factors influencing your mortgage rates, there are steps you can take to enhance your odds of landing a favourable deal.
Enhance your credit standing
Lenders across the country will take into account your credit score when passing you through their affordability checks.
So before this takes place, it may be worth reviewing your credit report for any inaccuracies. In addition, it is also important to stay up-to-date with your bill payments and to reduce your existing debts where possible.
Explore your options
Utilise digital tools for mortgage rate comparisons and gather rate quotes from diverse lenders, including traditional banks, building societies, and online entities.
Engage a mortgage specialist
A good mortgage broker should have a good understanding of the market. So if you’re unsure of whether you want to take out a fixed or variable rate, a broker can give you personalised advice to guide you through your decision.
By being proactive about your credit health, comparing wisely, and staying updated, you’ll be well-placed to snag the most favourable mortgage rates out there.
Speak to our preferred brokers, Mortgage Advice Bureau, to find the right mortgage for you
Should I only look at the best mortgage rates?
While rate plays an important role when looking at your mortgage options, there are other important factors to consider.
One of these are the fees that are charged on top of the mortgage.
Some of the lowest rates on the market typically come with higher than average fees, which may make the overall cost of your mortgage more expensive than other options.
What else should I consider when choosing the best mortgage rate?
In addition to fees, there are other parts of your mortgage deal to consider. Below we’ve listed some things to consider:
- Overpayments – These are additional contributions you can make towards your mortgage to reduce the interest you owe. Most lenders allow you to overpay up to 10% of your mortgage before charging you a penalty fee. However, this isn’t always the case, so if you would like this option it is important to check your lender’s terms and conditions
- Early repayment charge – If your lender does allow you to overpay on your mortgage, then it might charge you an early repayment charge. Otherwise known as a redemption or exit fee, this will likely come in the form of a percentage of your mortgage value
- Incentives – Some lenders offer incentives to entice new customers and reduce the cost of their mortgage. These typically take the form of cashback or a complimentary service, like a free valuation
Speak to our preferred brokers, Mortgage Advice Bureau, to find the right mortgage for you
Should I consider a fixed or variable rate?
The main benefit of a fixed mortgage deal is that it offers a degree of certainty. If you take out a fixed deal today and the Bank of England increases interest rates – however unlikely that may seem, we don’t know what will happen over the coming years – then you’ll be protected from these rises.
However, the opposite is also true. If the Bank of England feels the need to lower its base rate then you could end up paying a more expensive mortgage.
This is where a variable deal has its benefits. A tracker mortgage, for example, will mimic the movements of the Bank of England’s base rate. So if interest rates begin to fall so will your monthly repayments – bearing in mind that most tracker mortgages have a ‘floor’ below which the interest rate cannot fall.