MORTGAGE TYPES
Types of Mortgage Products Explained
Understanding mortgage products is crucial when making the right decision. We will guide you, but here is a clear overview
Your home may be repossessed if you do not keep up repayments on your mortgage.
MORTGAGE TYPES
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Guaranteed interest rate for a set period (typically 2–5 years) - Your payments stay the same throughout the fixed term, giving you stability and protection from market fluctuations.
Protection against interest rate increases - Even if rates rise, your monthly payments won’t change, helping you avoid unexpected financial pressure.
Ideal for budgeting certainty - A fixed payment each month makes it easier to plan ahead and manage your household finances with confidence.
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Linked to the Bank of England base rate - Your payments move in line with changes to the base rate, giving you a transparent link to market conditions.
Monthly payments can increase or decrease - As rates shift, your repayments adjust accordingly, offering flexibility but with potential for fluctuation.
Often lower initial rates - Tracker mortgages typically start with a lower rate than fixed deals, making them appealing for short‑term affordability.
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Discount applied to the lender’s standard variable rate - You benefit from a reduced rate compared to the lender’s SVR, giving you immediate savings at the start of your deal.
Variable payments with initial savings - Your monthly payments can change over time, but the discounted starting rate often makes this option more affordable upfront.
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Set by the lender - The interest rate is determined solely by the lender, and can change at their discretion.
Typically higher and subject to change - Standard variable rates are usually higher than introductory deals and can rise or fall over time.
Usually a fallback after introductory deals - You’re moved onto the lender’s SVR when your fixed, tracker or discount period ends, unless you secure a new deal.
EDUCATION HUB
Want to Learn More about different types of mortgages?
Explore our Education Hub for clear, jargon‑free guides that break down every stage of the mortgage process. From understanding different mortgage types to navigating complex income, our resources give you the clarity and confidence to make informed decisions about your next move.