Hundreds of fixed-rate mortgage deals drop below 5% – but is now a good time to fix?

What to consider before fixing

Whether it's a good time to lock in a new fix now will depend on your circumstances.

My mortgage deal is ending soon, or has already ended 

The most important thing is to avoid falling onto your lender's standard variable rate (the rate you revert to when your current deal ends). Some lenders' standard variable rates have edged over 7% recently – far higher than the most competitive fixed and variable deals.

If you want to fix now, remember that once you're locked, you won't be able to leave the deal early without paying a hefty fee. On the plus side, once you do you'll have certainty of what you'll be paying for the duration of the deal.

One option if you'd rather wait before fixing is to temporarily move on to a tracker mortgage, specifically one which lets you switch to a fixed deal penalty-free at a time of your choosing. Tracker rates are as low as 3.74% right now, though variable deals come with their own risks, such as your interest rate increasing if the Bank of England hikes the base rate. In December 2022, base rate rose for the ninth time in a year taking it to 3.5%. 

See our What mortgage to choose guide for the differences between fixed and variable deals.

My mortgage deal isn't ending for a few months

Here, you've got extra wriggle room and time to consider your options.

If you want a new fix, but can afford to wait before locking in, this might be worth doing. That's because some brokers and analysts believe interest rates will continue to edge down in 2023 – possibly to as low as 4%. You can read about their views in our  Mortgage rates: 2023 forecast.

Of course, without a crystal ball, there is no way of knowing what's going to happen in future. This means that often the best course of action is to discuss your situation with a mortgage broker. See our Cheap mortgage finding guide for tips on speaking to brokers.