2-year fixed-rate mortgages

What is a 2-year fixed-rate mortgage?

Your mortgage will have the same (fixed) rate of interest for two years. This means that your monthly mortgage payments won’t change for two years, either. 

It doesn’t matter what goes on in the mortgage market, the wider economy or with the Bank of England’s base rate. The interest rate you chose at the start of the deal won’t change for the fixed period. 

2-year fixed-rate mortgages tend to be one of the most popular options amongst homeowners - particularly when rates are high.

For example, in December 2023 when rates were higher than they are today, 67% of borrowers opted for a 2-year fix. This fell to 51% in March 2025, likely because more homeowners are opting for a longer fix as mortgage rates start to come down.

Why choose a 2-year fixed-rate mortgage?

• Payment peace of mind. Knowing your mortgage payment will be the same for two years helps you manage your money. Set your budget with more confidence, without worrying about how unexpected increases might impact your cashflow. 

• Shielded from rate rises. Your payments won’t change even if interest rates across the market surge. This gives you a sense of security if rates are predicted to rise. 

• Shorter commitment. A 2-year fix offers more flexibility compared to longer fixed-rate periods (such as 5 or 10 years). So, if rates fall or your circumstances change, you won’t have as long to wait until you can remortgage onto a more suitable deal. 

• Competitive rates. Shorter fixed-rate deals may come with more attractive rates. This could mean lower monthly payments compared to other variable mortgage types or long-term fixed-rate options. 

Disadvantages of a 2-year fix

• Miss out if rates fall. If interest rates in the wider market drop during your two-year fixed period, you’ll be stuck paying the higher initial rate until your fixed term ends. 

• More remortgage admin. You’ll have to go through the remortgage process again after just two years, which can be costly if you don’t remortgage with the same lender - both in terms of time and potential fees. 

• Limited long-term security. While it’s great to have stability for two years, in the grand scheme of a mortgage (which can last well over 25 years) it’s a relatively short space of time. You won’t have peace of mind for as long as you would if you opted for a five or ten year fix. 

• You’ll be charged for changes. Two years can pass in a flash, but a lot can happen within that time too. If you want to move house, make significant overpayments or pay off your mortgage early, you’ll likely face early repayment charges for doing so.

• Higher rates in exchange for security. You may find yourself paying higher initial rates on a 2-year fix than you would on, say, a tracker mortgage which follows the Bank of England base rate. That’s because you’ll be paying a premium for the stability and security a fixed-rate mortgage offers.

Take the quiz! Is a 2-year fixed rate mortgage right for me? 

If you answer ‘yes’ to most of these statements, a 2-year fix could be a great option for you.  

• I want my monthly payments to stay the same

• I don’t want to worry about interest rates rising 

• If interest rates fall, I don’t want to miss out on a better deal for too long

• I could comfortably afford higher monthly payments if interest rates increase in two years’ time 

• My circumstances might change in a few years 

• I don’t mind remortgaging more often if I get a cheaper deal

Average 2-year fixed mortgage rates in the UK

The interest rate you’ll be offered for a fixed-rate mortgage will depend on several factors including your personal and financial circumstances, credit history, deposit size and lender criteria.

However, the table below can give you a rough idea of mortgage market trends. It shows the average rate for two-year fixed-rate mortgages available from five of the biggest UK lenders (Santander, Nationwide, Natwest, Halifax and HSBC).

*Data accurate as of 24th April 2025 

Will mortgage rates come down in the next few years?

Industry experts are predicting that mortgage rates will start to gradually fall over the next few years. This will, of course, depend largely on whether the Bank of England decides to further reduce the base rate throughout 2025. The base rate was last reduced in May 2025, with some analysts predicting that we may see further cuts this year. 

Other fixed-rate mortgage lengths

The proportion of customers applying for selected products is based on Mojo Mortgages’ internal customer application data.

Rates and details of products available from selected lenders are correct as of 24 April 2025. These are subject to change and may not be available when you are ready to submit an application.