A Fixed Rate Mortgage fixes your monthly payments for a set period of time – usually between 1 and 5 years, but also available for longer terms, i.e 10-25 years. At the end of this time, your mortgage will revert to the lender’s standard variable rate (SVR); this usually means that your monthly payment will increase.

The advantage of this type of loan is that you know exactly what your mortgage will cost during the fixed rate period; unfortunately, you will not benefit from any reduction in interest rates.  You should also be aware that this type of mortgage usually carries early repayment charges, which can extend beyond the fixed rate period in some cases.  This potentially locks you into an uncompetitive SVR.