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Should I get a 2 or 5 year fixed mortgage?
So you’ve decided to opt for a fixed-rate deal… but should you lock in your rate for two or five years, or maybe even longer? Different deal lengths have distinct advantages and disadvantages. Understanding them can help you figure out the best fit for your circumstances.
About fixed-rate mortgages
A fixed-rate mortgage guarantees your interest rate won’t change for a set period of time. As a result, your monthly payments won’t change either, which can make budgeting easier.
When your fixed period ends, you’ll be automatically moved onto your lender’s standard variable rate (SVR) unless you remortgage onto a new deal. If you decide to remortgage, the decision-making process starts again and you’ll need to work out what kind of mortgage you want to choose and, if fixed, how long you want to fix for.
Still deciding on the best mortgage type for you? Read our guide on the differences between fixed and variable rate mortgages.
Choosing the right deal length for you
Your mortgage deal length is the amount of time your interest rate is fixed for. When choosing a mortgage, one of the most important factors is deciding whether to choose a short-term or long-term fixed-rate mortgage. The most popular options are 2-year and 5-year deals.
Two-year fixed-rate mortgages
With a two-year fixed-rate mortgage, the interest rate won’t change for the first two years of your deal. That means your mortgage repayments will stay the same for two years too, no matter what happens to interest rates during that time.
At the end of the two years, you’ll be able to switch to a new deal without penalty. But if you choose to leave or repay the mortgage balance before the end of the deal term you’ll be faced with early repayment charges.
Five-year fixed-rate mortgages
With a five-year fixed-rate mortgage, your interest rate and monthly payments remain constant for five years. This helps to provide predictable budgeting.
At the end of the five-year period, you will be able to choose a new mortgage deal without early repayment penalties. While it’s still possible to switch deals or repay the mortgage balance within the five-year period, it usually incurs fees.
Two-year versus five-year residential mortgage rates
| Deal type and length | Current average rate across all lenders | Current average rate across big six lenders |
|---|---|---|
| 2 year fixed-rate (75% LTV) | 5.14% | 4.47% |
| 5 year fixed-rate (75% LTV) | 5.24% | 4.32% |
All average rates are provided by Mojo Mortgages. The above are the average mortgage rates for various products across the market. These won't necessarily be available to you, and are not the only product types available.
Speak to a broker to find out your options
Work with our broker partner, Mojo Mortgages, to help you find the best mortgage product for your needs. They’ll talk you through the different options available and compare deals from across the market to make their personal recommendations.
The differences between a 2 or 5 year fixed mortgage
The obvious difference between 2 and 5-year fixed-rate mortgages is the amount of time your interest rate is fixed for. A two-year fixed mortgage has a fixed interest rate for two years whereas a five-year fixed mortgage - you guessed it - has an interest rate that’s fixed for five years.
Here are some of the other key considerations to take into account...
| Two-year fixed-rate mortgages | Five-year fixed-rate mortgages | |
|---|---|---|
| Initial rate | Initial rates are usually lower compared to five-year deals, though in recent years two-year fixes have been slightly more expensive | Initial rates may be slightly lower compared to two-rate deals at the moment, though this isn’t always the case and five-year fixes have carried higher interest rates in the past |
| What happens if interest rates rise? | You may end up moving onto a more expensive deal sooner | You’ll be protected against higher rates for five years |
| What happens if interest rates fall? | You are only locked into your existing rate for two years, so may be able to move onto a lower-rate deal sooner | You may end up paying a higher rate of interest for longer, unless you choose to remortgage sooner (which usually comes with additional costs to consider) |
| Remortgage costs - both in the short and long-term | You’ll need to factor in potential remortgage fees (such as product fees and valuation costs) after a shorter amount of time. These costs soon rack up over the lifetime of a mortgage | You’ll only need to consider remortgage fees once every five years which could save you money (and hassle) in the long-term |
| Flexibility if you need to remortgage sooner | If your circumstances change or you decide to move house, you don’t have as long to wait until your deal ends. This could help you avoid early repayment charges | Need to remortgage before your five-year deal ends? You’ll likely be left paying hefty early repayment charges. These are usually more expensive the longer you have left until the end of the deal |
| Long-term stability | Your mortgage rate (and monthly repayments) are likely to change every two years which could make long-term budgeting harder. You’ll also need to repeat the mortgage process more frequently | Your monthly payments won’t change for five years, giving you greater financial stability and predictability. You can put remortgaging to the back of your mind for five years, too |
Compare two-year and five-year mortgages
Want to find out whether a two or five-year mortgage is the right choice for you? Speak to a qualified mortgage broker to compare rates, overall costs and terms for the two and five-year mortgage products available to you.
Should I choose a two-year or five-year fix?
Ultimately, the decision comes down to your own personal and financial circumstances. Consider what elements of a short or long-term mortgage deal are important to you, rather than solely focusing on trying to predict what might happen to interest rates in the future.
Some of the main things to consider are:
Total cost: A two-year fix may carry similar or even lower initial interest rates (though this hasn’t been the case for the last few years) but you’ll need to factor in the costs of remortgaging more frequently too
Your risk tolerance: Individuals who prioritise stability and long-term budgeting may prefer to fix for longer, whereas those keen to capitalise on the lowest possible rate may opt for a two-year fix if they think rates will fall soon
Future plans: Planning to move house or expect your income to change? A two-year fix could give you greater flexibility. However, those expecting their circumstances to remain roughly the same may appreciate the stability of a five-year fix.
Your financial situation. Always make sure that you can comfortably afford your monthly mortgage payments, whether you opt for a two or five-year fix. It’s worth asking yourself if you would be able to afford to pay a higher rate if interest rates did increase in the future - if it would currently be a stretch, it may be worth considering a longer-term fix for peace of mind.
You don’t have to make the decision alone. A mortgage advisor can assess your financial situation, talk you through what matters most to you and provide personalised recommendations based on your needs. ”Laura Hamilton, Mortgage Expert
FAQs
Are two-year fixed-rate mortgages cheaper than five-year ones?
Shorter-term mortgages like two-year fixed deals are traditionally cheaper than longer-term deals, as borrowers usually pay a premium for the security of a longer-term fixed rate.
However, over the last few years, five-year fixed-rate mortgages have been very similar - if not slightly cheaper - than shorter-term two-year fixed mortgages. There are a number of reasons for this:
Following plenty of volatility in the market, lenders may be anticipating interest rates to fall in the longer term. Therefore, borrowers on shorter-term mortgages may represent more of a risk to lenders if they’re likely to remortgage onto lower rates after the two-year fixed period
Two-year fixed-rate mortgages became more popular as interest rates soared over the last few years, which further increased the risk for lenders
In April 2025*, the average interest rate on a two-year fix was 4.6% compared to 4.4% for the average interest rate on a five-year fix.
If the Bank of England cuts the base rate and interest rates decrease in the near future, two-year fixed mortgage deals may once again become slightly cheaper than five-year fixed mortgages. However, there are no guarantees as lots of other things impact how lenders price their mortgage products.
It’s worth noting that whether you can personally access to the cheapest rates will depend on many other factors too, such as your individual circumstances and the specific deal chosen. It’s worthwhile consulting a mortgage broker to help you discover your options.
*7 April 2025
How long can I fix my mortgage for?
Two of the most popular options are 2-year and 5-year fixed-rate deals, though it is possible to fix a mortgage for a shorter or longer period of time.
The maximum deal length most lenders offer tends to be 10 years, though it’s not unheard of for some lenders to offer a fixed deal that lasts for the full mortgage term.
Typically, longer-term deals come with a higher interest but in return you’ll get peace of mind that you won’t need to worry about fluctuating interest rates for a set number of years.
Speak to a broker if you’re keen to find out the maximum fixed-rate deal length that might be available to you. They’ll be able to compare the market and recommend a mortgage product to suit your personal circumstances.
Is the mortgage deal length the same as the term length?
No, it’s not. The term length is the full duration of the loan. It’s the number of years it will take you to fully repay the borrowed amount, plus interest, to the lender.
The deal length refers to the length of time a specific interest rate is guaranteed. This is usually two or five years, so you’ll typically choose several different mortgage deals over the lifetime of your mortgage.
Do variable rate mortgage deals have a fixed term?
Standard variable rate mortgages don’t have a fixed term so, if you like, you can stick with the same mortgage product for the entire term (though this may be a much more expensive option!).
Tracker mortgages and discount mortgages, on the other hand, are often offered for a set length of time - such as a two-year deal. As with fixed-rate mortgages, you may need to pay an early repayment charge if you want to switch to a different mortgage product before the deal ends.
How will interest rates impact 2-year and 5-year fixed-rate mortgages in 2025?
While we can’t predict for certain what’s going to happen with interest rates, it’s a good idea to keep an eye on industry trends and predictions.
The Bank of England is expected to drop the base rate at least slightly over the next two years but mortgage rates are not guaranteed to fall significantly. It’s up to you whether the possibility of lower interest rates is enough to justify you worrying about rate fluctuations and more frequent remortgaging.
On the flip side, if accessing the very best deals available is a priority for you, you may enjoy the flexibility of a two-year fixed-rate deal. You then know you only have a short amount of time to wait before you can remortgage without any penalties, so you can assess the market, compare deals and find the best mortgage product for you more frequently.
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. To contact Mojo by phone, please call 0333 123 0012.
*Average savings are based on Mojo Mortgages residential remortgage sales data, compared to the average SVR in February 2025. Actual savings will depend on individual circumstances.