# Mortgage rates explained: fixed, tracker and the cost of waiting > Mortgages & first homes · Last updated 1 June 2026 Canonical HTML: https://moneyguide.org.uk/mortgages/mortgage-rates-explained/ Markdown mirror: https://moneyguide.org.uk/mortgages/mortgage-rates-explained.md ## Quick answer A mortgage rate is the interest your lender charges. Most UK borrowers choose a fixed rate for certainty, while trackers follow the Bank of England base rate. Your loan-to-value band is the biggest factor in the rate you are offered. ## Who should skip this Skip this page if you need a personal recommendation or a live quote. This is general UK information — confirm today's figures with the official source linked below. The rate on your mortgage is the single biggest cost of buying a home. This guide explains the main rate types, how the Bank of England base rate feeds through, and why your deposit size moves the rate you can get. ## Key facts - Fixed-rate deals lock your interest rate for a set period, usually 2 or 5 years - Tracker rates move with the Bank of England base rate, so payments can rise or fall - When a deal ends you move to the lender's standard variable rate (SVR), which is usually much higher - Lower loan-to-value (a bigger deposit) unlocks cheaper rates, with key thresholds at 90%, 85%, 75% and 60% ## Fixed, tracker and SVR A fixed rate keeps your interest rate and monthly payment the same for the deal period, giving certainty. A tracker follows the base rate plus a set margin, so it falls when the base rate falls and rises when it rises. A standard variable rate is the lender's default rate after your deal ends — almost always worth avoiding by remortgaging. Most borrowers fix for two or five years. A longer fix gives more certainty but less flexibility; a shorter fix lets you re-shop sooner but more often. ## Why your deposit changes the rate Lenders price by loan-to-value (LTV) — the loan as a percentage of the property value. The smaller the loan relative to the home, the lower the risk, and the cheaper the rate. Pushing your deposit just past a threshold (for example from 90% to 85% LTV) can noticeably cut your rate. Compare the true cost including any product fee (often £999–£1,495), not just the headline rate. A slightly higher rate with no fee can be cheaper on a smaller loan. ## Frequently asked questions ### Should I fix for 2 or 5 years? A 5-year fix gives longer certainty and no remortgage costs in between; a 2-year fix lets you grab a better rate sooner if rates fall. The right choice depends on your plans and appetite for risk. ### Can I leave a fixed rate early? Usually only by paying an early repayment charge, which can be a few percent of the balance. Always check the ERC before fixing for a long period. ## Primary source https://www.bankofengland.co.uk/monetary-policy/the-interest-rate-bank-rate ## Related - [How much can I borrow?](https://moneyguide.org.uk/mortgages/how-much-can-i-borrow/) - [Mortgage repayment calculator](https://moneyguide.org.uk/tools/mortgage-repayment-calculator/) --- Independent UK money guidance from [Money Guide](https://moneyguide.org.uk). Information only — not regulated financial advice.