More than one million homeowners are due to reach the end of two-year fixed-rate mortgages during 2026, potentially leaving borrowers exposed to significantly higher repayments if they revert to their lender’s standard variable rate.
Data sourced by Compare the Market shows 1,095,905 borrowers coming off two-year fixes originally taken out during 2024, when the average rate was 4.81%.
The group includes 122,526 first-time buyers, 111,349 home movers and more than 813,000 borrowers who previously remortgaged either with their existing lender or a new provider.
Based on an average outstanding mortgage of £200,250 over 25 years, Compare the Market calculates that moving from a 4.81% fix onto the current average standard variable rate of 7.13% would increase repayments by £283 a month.
REMORTGAGE OPPORTUNITY
The potential increase highlights the importance of borrowers reviewing their options before reaching the end of their current deal.
Compare the Market’s calculations put repayments on the average SVR at £1,432 a month, compared with £1,149 on the average two-year rate secured in 2024.
However, the average two-year fixed mortgage rate recorded by the Bank of England in July was 4.79%.
On the same £200,250 mortgage, moving onto a new deal at that rate would produce estimated repayments of £1,146 – £286 a month below the average SVR.
The comparison does not account for individual circumstances, product fees or other charges associated with remortgaging.
BORROWERS URGED TO ACT EARLY
Laura Pomfret, Personal Finance Expert at Compare the Market, says: “An extra £283 a month on your mortgage is a significant amount of money for most households. That’s more than £3,000 over the course of a year, so simply rolling onto a higher rate without considering your options could have a real impact on your budget.”
She adds: “It makes sense to shop around well in advance of any fixed deal ending as these things can take time and you could lock in a good rate.”
Sajni Shah, Money Expert at Compare the Market, says borrowers should consider the wider market even if they ultimately remain with their existing lender.
She adds: “Taking the time to explore your options before your current deal ends could help you secure a more competitive mortgage and avoid paying more.”
