Fixed Rate Mortgages

A fixed rate mortgage provides a guaranteed monthly payment over a fixed period of time. If you like the reassurance of knowing exactly what your monthly payments are going to be then a fixed rate mortgage maybe suitable for you. Once the fixed rate time period ends your monthly repayments usually switch to the mortgage lenders standard variable rate. The downside of a fixed rate mortgage is if the Bank of England base rate falls you could be paying more than you need to each month. The upside is that if the Bank of England base rate rises, your repayments remain the same. This type of rate enables you to forecast and budget in the early years of the mortgage term. (Also ensure you ask what the early repayment charges are).
 

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