When applying for a mortgage, the type that you choose will likely come down to what suits your circumstances. The mortgage types are split into two: either fixed-rate or variable. Of the latter, mortgages are split into three different categories: known as trackers, standard variable rates (SVRs) and discounts. As it may be inferred from its title, a fixed-rate mortgage has a fixed interest rate, which doesn’t change for the length of its deal.
Mortgage fees can add up, so look around
Deborah Vickers
“You’ll see them advertised as ‘two-year fix’ or ‘five-year fix’, for example, along with the interest rate charged for that period,” the Money Advice Service explains.
Deborah Vickers, channel director and financial expert at personal finance comparison site moneyguru.com, also shared some insight into this type of mortgage.
She said: “Regardless of the mortgage deal, do your research. There are so many different types of deals.
“Fixed rate mortgages are great as you know exactly what your mortgage will cost, so this can help you with budgeting,” Ms Vickers said.
“The rates on a fixed deal are normally higher than variable products and if the interest rates fall, you won't see your payments drop.”
The channel director also suggested doing some research before committing to one type of deal.
She said: “Mortgage fees can add up, so look around. If you like to budget and know what you are paying, then fixing could be a good idea.
Mortgage rates: The best type of mortgage depends on a person's own situation (Image: GETTY)
“It's difficult to predict
