Finding the right two-year fixed-rate mortgage deal can be tricky.
Should I fix my rate for longer? What extra fees are involved? What if I want to move soon?
Let Mojo’s expert advisers compare deals to find your best two year fixed-rate mortgage.
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YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
The FCA does not regulate mortgages on commercial or investment buy-to-let properties.
With a two-year fixed-rate mortgage, your interest rate stays the same for the first two years of your deal. So your mortgage repayments won't rise, no matter what happens to interest rates during that time.
Like the majority of mortgage deals, most two-year fixed-rate mortgages charge fees if you leave or repay the mortgage balance before the end of the deal term.
This table shows some of our partner Mojo's best two-year fixed-rate mortgage deals based on their initial rates available at different loan-to-value (LTV) ratios. This initial rate is what you pay throughout the introductory period (for a two-year fixed-rate mortgage, the introductory period is two years).
The APRC (Annual Percentage Rate of Change) is included in brackets after each initial rate. APRC provides an overall picture of the mortgage deal, taking fees and the lender's standard variable rate (SVR) you typically fall onto after the introductory period into account.
|Current 2-year fixed mortgage rates
Leek Building Society
Initial rate: 4.98% | APRC: 7.7%
Repayment mortgage of £252,000.00 over 25 years, representative APRC 7.7%. Repayments: 28 months of £1,474.66 at 4.98% (fixed), then 272 months of £1,952.17 at 8.24% (variable). Total amount payable £572,280.72. Early repayment charges apply until 30-Jun-2026. Arrangement, mortgage discharge, valuation and CHAPS fees total £1100. Legal fees £120
Initial rate: 4.67% | APRC: 8.2%
Repayment mortgage of £224,000.00 over 25 years, representative APRC 8.2%. Repayments: 28 months of £1,272.43 at 4.67% (fixed), then 272 months of £1,804.03 at 8.74% (variable). Total amount payable £526,324.20. Early repayment charges apply until 30-Jun-2026. Arrangement, mortgage discharge, valuation and CHAPS fees total £1099. Legal fees £161.27
Initial rate: 4.4% | APRC: 8.2%
Repayment mortgage of £196,000.00 over 25 years, representative APRC 8.2%. Repayments: 25 months of £1,083.28 at 4.4% (fixed), then 275 months of £1,580.08 at 8.74% (variable). Total amount payable £461,604.00. Early repayment charges apply until 31-Mar-2026. Arrangement, mortgage discharge, valuation and CHAPS fees total £1014. Legal fees £126
Initial rate: 4.38% | APRC: 8.2%
Repayment mortgage of £168,000.00 over 25 years, representative APRC 8.2%. Repayments: 25 months of £927.33 at 4.38% (fixed), then 275 months of £1,355.20 at 8.74% (variable). Total amount payable £395,863.25. Early repayment charges apply until 31-Mar-2026. Arrangement, mortgage discharge, valuation and CHAPS fees total £1014. Legal fees £126
The above fixed rates are provided by Mojo Mortgages and updated every 12 hours. THEY MAY NOT BE AVAILABLE WHEN YOU'RE READY TO SUBMIT AN APPLICATION.
Two year fixed rate mortgage deals offer the peace of mind of knowing exactly how much your mortgage will cost for those two years. This makes them a good choice if you want to be sure that your payments that won't rise for a set period.
While two year fixes have historically been cheaper than five year fixed-rate mortgages, this is not always the case. Five year fixes have been lower priced than the best two-year fixed mortgage rates for some time now.
“Once you’ve found a rate you’re happy with, move quickly in order to secure it. In some cases lenders are only providing a couple of hours’ notice before increasing rates, so have your documents ready and get them to your broker as soon as possible.”
Dean Wickett, Mortgage Expert at Mojo Mortgages
Once you've weighed up the price differences, how long you fix your mortgage rate for comes down to how much certainty you need, your current financial circumstances, and what your future plans are, both financially and in terms of home ownership.
You could consider the following when making your choice:
Is security or saving money more important to you? – if it’s security you might feel better to fix for longer, but this way there's more potential to lose out if mortgage interest rates fall
How long will you stay in your home? – if you’re looking to move home in a couple of years, it’s probably best not to fix for a long duration. You may need to remortgage and if you’re locked into a fixed-rate period, it would be much more expensive to switch mortgages if you needed to
Remortgage fees – even if you stick to shorter fixes to avoid ERCs, there are still a range of fees that apply to remortgaging, which means you can face significant costs if you remortgage regularly
When your two year fixed rate period ends, you automatically move on to your lender’s standard variable rate (SVR). This is almost always higher than mortgage deals available from your existing and new lenders.
To avoid the SVR, it's best to start looking at your remortgage options six months before your deal comes to an end. This allows you to lock in a rate early that may not be available in six months time. You then transfer to the new deal when your rate ends, instead of the SVR. This includes 5 year fixed rate and 10 year fixed rate mortgage deals.
The best thing is, if you see a better mortgage rate in the meantime, you can still switch, as you're not locked into a new deal until your existing one expires.
Longer deals can help you maintain long-term financial stability and may be a good option if you expect mortgage interest rates to continue rising for a few years.
However, it’s worth weighing this up against the fact that you'd likely have to pay a considerable amount in early repayment charges (ERCs) to leave a longer deal early if rates do fall.
Your repayments won't rise for two years, even if mortgage rates go up
Knowing how much you’ll be paying each month makes it easier to manage your finances
If interest rates rise across the market, you're likely to be paying less than on a variable-rate deal
If rates fall or you want to move house, you only have to wait two years at most to pay off your mortgage without facing ERCs
You’ll generally pay higher mortgage rates than variable rate deals at the start
You’ll lose out on more competitive rates if interest rates fall during your two year fixed rate mortgage term
You’ll usually pay a higher arrangement fee for a fixed-rate
You’ll need a new deal in two years, which means more remortgage fees
If you want to switch your mortgage within two years, you’ll usually still have to pay ERCs to leave early
Two-year fixed-rate mortgage deals offer peace of mind that your rate will remain the same for two years. Remember to lock in competitive rates quickly in the current market ”Kellie Steed, Mortgage Content Writer
No, the length of deal has no impact on your deposit size. Some two-year fixed-rate mortgages can be taken out with a very small deposit, such as 5% of the property’s value.
However, the bigger your deposit, the better the mortgage interest rates you’ll be offered by lenders. The best mortgage rates are usually available for buyers with a deposit worth at least 40% of the purchase price.
How much you can borrow will depend on your circumstances. Lenders have specific criteria, no matter what type or length of mortgage deal you opt for. Factors that impact how much you can borrow include:
How much you earn – most lenders will offer around four and a half times your income, but it can be more for higher earners and those in certain professions
How much you can put down as a deposit – the more you put down, the more you can typically borrow
How much you already owe – on things like other loans and credit cards
How much you spend – for example on household bills or child maintenance
Not necessarily – fixed rate mortgage deals are often more expensive than similar variable rate deals at the start. However, they offer more security, as the rate you pay will not change even if interest rates go up.
They can therefore prove cheaper in the long term if interest rates rise during the fixed-rate period. If, however, mortgage rates fall, you could end up paying over the odds.
Taking out any mortgage involves paying various fees. These can include:
Arrangement fees, which can range from £0 to more than £2,000
Legal fees, which vary depending on the property type and size
When searching for the best two-year fixed-rate mortgage, it’s therefore important to consider the total cost including fees, not just the mortgage rate on offer. The best way to do this is by looking at the total cost over the initial deal period.
You’ll have to pay ERCs (early repayment charges) if you want to pay the mortgage off early. These can be up to 5% of the total amount still owed on your mortgage.
If you’re within the last six months of your two-year fix, it’s possible to lock in a new mortgage deal that you'll automatically transfer onto without having to pay ERCs, once your deal ends.
Last reviewed: 3 October 2023
YOUR HOME/PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
The FCA does not regulate mortgages on commercial or investment buy-to-let properties.
Uswitch makes introductions to Mojo Mortgages to provide mortgage solutions. Uswitch and Mojo Mortgages are part of the same group of companies. Uswitch Limited is authorised and regulated by the Financial Conduct Authority (FCA) under firm reference number 312850. You can check this on the Financial Services Register by visiting the FCA website. Uswitch Limited is registered in England and Wales (Company No 03612689) The Cooperage, 5 Copper Row, London SE1 2LH. Mojo Mortgages is a trading style of Life's Great Limited which is registered in England and Wales (06246376). Mojo are authorised and regulated by the Financial Conduct Authority and are on the Financial Services Register (478215) Mojo’s registered office is The Cooperage, 5 Copper Row, London, SE1 2LH, and head office is WeWork No. 1 Spinningfields, Quay Street, Manchester, M3 3JE. To contact Mojo by phone, please call 0333 123 0012.