Hearing that around 1.8 million fixed-rate deals are finishing this year is enough to make anyone a bit twitchy, especially when the news is full of big banks hiking their rates every other day.
If you’ve been sitting on one of those ultra-low rates from a few years back, the jump to 5% or more feels like a massive punch to the gut for the monthly budget. It’s a bit of a double whammy at the minute; not only are the prices going up, but the actual number of deals on the table is shrinking faster than a cheap wool jumper in a hot wash, per UK Finance.
While we’re not quite back to the total chaos of 2022, the market is definitely volatile, and sticking your head in the sand is the worst thing you can do. You can’t control what the lenders do with their swap rates, but you can definitely take a few steps to make sure you aren’t just left at the mercy of whatever happens to be on the screen when your deal finally expires.
Here are some sensible things to do if rising mortgage rates are a worry.
Know your expiry date like the back of your hand.
The first thing you need to do is dig out your paperwork and find out exactly when your current deal ends. It sounds obvious, but a lot of people just have a vague idea that it’s sometime in the autumn. Knowing the precise date allows you to work backwards. Most lenders will let you lock in a new rate 90 days before your current one ends, and if you’re looking to switch to a completely new bank, you can often start that process six months out. Marking that date on the calendar is the starting gun for your planning.
Don’t wait for the letter to arrive.
If you wait until your bank sends you a polite reminder that your deal is ending, you’ve already lost months of potential planning time. The mortgage market is moving incredibly quickly right now, with hundreds of products being pulled in a single weekend. By starting your search early—ideally six months before your fix ends—you can get a proper look at what the damage might be. Even if you don’t pull the trigger immediately, knowing the numbers allows you to adjust your household spending now rather than having a meltdown when the first new payment leaves your account.
Lock in a safety net deal.
One of the best strategies in a rising market is to secure a deal early as a backup. Many lenders allow you to book a rate months in advance. The clever bit is that if rates actually happen to drop before your old deal ends, you aren’t usually legally tied to that new offer yet—you can often ditch it for a better one. However, if rates keep climbing, you’ve got that lower rate safely tucked away. It’s basically a free insurance policy against the market getting even worse while you wait.
Be honest about your household budget.
If your monthly payment is about to jump by £200 or £300, you need to know exactly where that money is going to come from. Now is the time to sit down with your bank statements and see where the “leakage” is. Are you still paying for a gym you haven’t visited since 2024? Do you have four different streaming services when you only watch one? Trimming the fat now makes the transition to a higher mortgage rate a lot less painful. It’s much better to find that extra cash in your subscriptions than to find it by skipping meals later.
Consider a tracker as a temporary move.
While most people crave the certainty of a fixed rate, it’s worth looking at tracker mortgages as a tactical play. A tracker moves up and down with the Bank of England base rate. If you think fixed rates are currently at a temporary peak and might settle down in a year or two, a tracker can give you the flexibility to move onto a fixed deal later without paying massive exit fees. It’s a bit more of a gamble, but for some, it’s a better shout than locking into a high five-year fix that they’ll regret if rates drop next summer.
Overpay while you still can.
If you’re still on a low rate for the next six months, any extra money you can throw at your mortgage now will reduce the total debt that gets refinanced at the higher rate. Even an extra £50 or £100 a month makes a dent in the principal amount. Most fixed deals let you overpay by 10% a year without a penalty. Reducing the loan-to-value (LTV) bracket you fall into can sometimes unlock slightly better deals when it comes time to remortgage, as banks see you as a lower risk.
Get a broker to do the legwork.
Trying to navigate the mortgage market yourself right now is a full-time job. Rates are changing so fast that by the time you’ve finished an online application, the deal might have been pulled. A good mortgage broker has a bird’s-eye view of the whole market and can see deals that aren’t always available on the high street. They can also tell you which lenders are currently taking ages to process applications, helping you avoid a situation where your deal expires before the paperwork is finished.
Talk to your lender if you’re struggling.
If you’ve done the maths and there is simply no way you can afford the new payments, don’t wait until you miss a payment to speak up. Banks are actually quite keen to help people stay in their homes because repossessions are a massive headache for them too. They have tools available, like extending your mortgage term to lower the monthly cost or moving you to interest-only payments for a short period. It’s much better to have these conversations early than to wait until you’re in the red.
