Providing expert mortgage advice for over 28 years.
Providing expert mortgage advice for over 28 years.
Bank of England Base Rate: It is now at 4.25%. This change happened after a cut in May 2025. More cuts to 4% might come later this year if UK inflation continues to drop.
Inflation Outlook: As of May 2025, inflation is 2.6%. This is slightly above the Bank’s target of 2%.
Mortgage Rates: The average rate for a two-year fixed rate deal is 4.64%. A five-year fixed rate is 4.60% as of May 2025.
Market Trends: Swap rates are lower. This indicates that lenders might be preparing to offer better fixed-rate mortgage products.
Advice: Borrowers should examine their individual circumstances. They might want to fix rates now to guard against sudden changes.
Mortgage rates appear to be decreasing.
Average two-year fixed rate: 4.64%
Average five-year fixed rate: 4.60%
Lowest two-year fixed: 3.72%
Lowest five-year fixed: 3.78%
Key drivers:
Economic Outlook: Inflation is at 2.6%.
Market Expectations: The base rate could decrease to 4% by late 2025.
Lender Competition: Increased competition among lenders is leading to better rate offers.
Borrowers should pay attention to changes in the coming months. It is important to act quickly when good offers appear.
More cuts could take place by Autumn 2025 if inflation continues to drop. Analysts believe that there will be some improvement, but not major changes. Getting a fixed rate mortgage now might be the best option instead of waiting for small shifts.
Fixing your mortgage rate now provides:
Be careful of sudden increases.
Stay consistent with monthly repayments.
A guarantee for a set time helps with better financial planning.
Waiting can be risky for borrowers. A variable rate mortgage might suit people who can deal with changes. However, many feel that a fixed rate mortgage offers more peace of mind.
When your fixed-rate mortgage ends, you need to act fast. This will help you get the best deal. First, check your financial situation. Look for any changes since you took out the mortgage. This could be changes in your income, credit score, or if you have new financial responsibilities.
Next, consider a product transfer with your current lender. This option might be easier and could help you skip extra fees. But remember to look for new deals that might have better rates or terms.
Our mortgage advisers can help you understand your options. Starting this process early is a good idea. It’s best to do it before your mortgage ends. This will help you avoid falling into a standard variable rate, which could increase your payments a lot.
Remortgage competition is increasing. If your fixed period is ending soon, now is a good time to get a new mortgage deal. This could help you lock in better rates.
We are here to help you find a new rate that works well for your financial situation.
Before you think about remortgaging, there are some important things to consider. First, check the details of your current mortgage. Know why you want to remortgage. This could be to get a better interest rate, to lower your monthly payments, or to access more money for home improvements. Then, look for any fees or penalties for ending your current mortgage. These costs can affect the savings from remortgaging.
Next, review your financial situation. This means looking at any changes in your income, job, and credit score. These factors will influence the new mortgage rates you can obtain. It’s a good idea to compare offers from different lenders. Also, pay attention to future interest rate trends. You want to find a deal that meets your current needs and future financial goals.
Our mortgage advisers can provide tailored advice and help you understand the remortgaging process. This way, you can make a good choice based on your specific situation.
Tracker mortgages are flexible. But the bank rate is now 4.25%. Many fixed-term deals may offer better monthly repayments. If you want to switch easily to cheaper fixed deals in the future, pick a tracker that has no early repayment fees.
A variable rate mortgage can be a great choice for people who want some flexibility. But be aware, it comes with more risk if the market changes.
Most lenders allow you to secure a new fixed rate six months before it starts. This means you can lock in today’s lower rates. You will have time to search for new deals before your fixed term begins.
It’s important to think about your own situation. You should especially look at your financial situation and your long-term goals when you make a decision.
Five-year fixed rates now cost about the same as two-year deals. A longer commitment can provide many benefits for people:
Dependable mortgage payments.
Safety from unexpected changes.
A feeling of calm for an extended period.
“Mortgage rates are falling, making it a good time for first-time buyers to consider locking in a fixed rate. While rates could drop further, locking in now can provide peace of mind against future increases. With our mortgage rate check service, you can easily switch to a lower rate if one becomes available.”
Craig Moore, Partner at Newhomes
If your mortgage is ending soon, you can:
Product Transfer: Stay with your current lender. This can be easier and may have lower fees.
Remortgage to a New Provider: Search for better deals. Remember that changing lenders might require new checks and could lead to extra costs.
Our mortgage advisors will help you explore both options. They will help you find the right choice for your needs.
If you have an SVR, you may be paying too much. SVRs usually cost around 8%. Changing to a discounted mortgage or a fixed term deal could help you save a lot on your mortgage repayments.
Talk to a mortgage expert at Newhomes. They can help you find better choices. This way, you won’t spend too much money without a good reason.
To get approved for a new mortgage deal, start by checking your finances. Make sure your credit score is good, usually above 700. Next, gather documents to prove your income, such as pay stubs or tax returns. Also, bring details about your current debts and expenses to show you can manage monthly repayments.
A steady job history will help your application too. Think about how much you can afford. A good rule is the 28/36 guideline. This means you shouldn’t pay more than 28% of your gross monthly income on housing. You should keep your total debt under 36%.
When you feel ready, talk Newhomes. We can compare offers to find the best rates. We can also make the application process easier, which may improve your chances of getting a new mortgage that suits your needs.
Get a fixed rate if your deal is ending soon.
Look at options with a trustworthy mortgage broker.
Talk to a mortgage advisor who is approved by the Financial Conduct Authority.
Keep up with changes in the Bank of England’s policy.
Do something before lenders remove their best deals.
The mortgage market in 2025 has risks and opportunities. Lower rates are a positive sign. However, timing and planning matter a lot. If you take action in the coming months and get good mortgage advice, you can save a significant amount.
Getting a fixed rate mortgage now can help you feel secure against unexpected changes in the future. If you feel unsure, our expert mortgage advisers at Newhomes are ready to help you find the best option for your financial situation.
At New Homes Mortgage Services LLP, we strive to provide accurate and up-to-date information at the time of publication. However, due to the dynamic nature of the property market, details may change and this content is intended for general informational purposes only. It does not constitute financial or professional advice and should not be relied upon as such.
We cannot accept responsibility for any decisions made based on this information. For advice tailored to your individual circumstances, please consult our qualified mortgage advisors. We recommend that you independently verify any important details before making financial commitments.
