Mortgage rates hit 6%: what should existing borrowers do?

The average UK five-year fixed mortgage rate reached 6% on 5 October 2026. Moneyfacts puts the average two-year fix at 5.98%.

Both averages now stand at their highest levels for around three years. If your fixed deal ends within six months, start reviewing your options now.

These figures describe market averages, not necessarily the rate you will pay. Your equity, circumstances and chosen mortgage will influence your available deals.

Will my current payments increase?

If you already have a fixed rate, these increases do not change it. Your immediate priority is checking when that protection ends.

Borrowers leaving five-year fixes around 2% could face a substantial payment increase. Your fixed deal has sheltered you through inflation, interest-rate rises and the mini-Budget upheaval.

Now, calculate your likely replacement payment before choosing your next mortgage. Use your outstanding balance and remaining term, rather than your original borrowing figures.

Deal ending within six months? Start comparing now

Starting early does not mean ending your current deal early. You may secure a replacement fixed rate that starts after your existing deal finishes.

Some lenders allow bookings six months ahead; others have shorter windows. Your adviser can check application deadlines, offer expiry dates and any early repayment charges.

Compare two routes:

Remortgage: move your mortgage to another lender.
Product transfer: choose a new deal with your existing lender.

Look beyond the headline rate. Compare payments, product fees, legal costs and the overall cost during the deal.

Securing a replacement fixed rate can protect against further increases before completion. However, lenders impose conditions, and your application must meet their requirements.

If rates fall, ask whether you can change your reserved deal. Cancellation deadlines, fees and lender rules mean this flexibility is not guaranteed.

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Should I wait for mortgage rates to fall?

Nobody knows where mortgage rates will go next. The Bank of England held Bank Rate at 3.75% in September.

Governor Andrew Bailey warned that prolonged energy-price volatility could make increases more likely. That warning does not guarantee a rise, but relying on imminent cuts carries risk.

Fixed mortgage rates also reflect wholesale funding costs and market expectations. They can rise even when Bank Rate stays unchanged.

Rather than trying to predict rates, compare options against your budget and priorities.

What if higher payments look unaffordable?

Discuss affordability before your deal ends. Contact your lender promptly if you think you might miss a payment.

Extending your mortgage term

Extending a repayment mortgage’s term can reduce monthly payments. However, paying interest for longer usually increases the total cost.

Extending an interest-only mortgage does not, by itself, reduce monthly interest payments. It delays when you must repay the outstanding capital.

Switching to interest-only payments

Switching some or all borrowing to interest-only may reduce monthly payments. However, you stop repaying that portion of the capital.

Permanent interest-only borrowing requires an acceptable repayment plan and lender approval. Some lenders also offer eligible borrowers temporary interest-only support.

Ask how payments and total costs will change afterwards. A temporary reduction is not debt forgiveness.

Using savings or making overpayments

Savings or overpayments could help reduce your loan-to-value ratio. This measures your mortgage balance against your property’s value.

Reaching a lower loan-to-value band may unlock better mortgage pricing. Check overpayment charges, compare savings returns and retain an emergency fund.

Check your loan-to-value

Change any value and the other figures will update automatically.

Try an example: £250,000 home with a £25,000 deposit → 90% LTV

Property value

£40,000 £5,000,000

Changing the property value keeps the mortgage amount and recalculates your deposit or equity and LTV.

Deposit or equity

£0 £200,000

Mortgage amount

£0 £200,000

Loan-to-value

50%

0% 100%

Your loan-to-value

50%

A £100,000 mortgage on a £200,000 property.

50%

50% mortgage 50% deposit or equity

Search mortgages with these figures

Starts with a residential purchase. You can change the mortgage type and purpose in the search.

No mortgage borrowing needed

With these figures, the property value is fully covered by your deposit or equity. No mortgage borrowing is required.

Small mortgage amount

Fewer lenders offer mortgages below £25,000, so your options may be limited. Product and legal fees can also have a greater impact on the overall cost of a smaller mortgage.

Low property value

Fewer lenders offer mortgages on properties valued below £50,000. Minimum property values vary by lender and property type.

Buying to let?

If this is a buy-to-let purchase, most lenders cap borrowing at 75–80% loan-to-value, with some specialist options reaching 85%. This cap applies to buy-to-let mortgages only — residential lending typically extends to 95%.

High-LTV residential mortgage

Residential mortgages above 95% LTV have limited availability and often require a specialist mortgage product or scheme. Talk to your mortgage adviser about your options.

No deposit or equity buffer

You have no deposit or equity buffer. A fall in the property's value could leave you owing more than it is worth. No-deposit residential mortgages have limited availability and specific eligibility requirements. Speak to your mortgage adviser.

Fixed or tracker: how much certainty do you need?

A tracker mortgage may offer a lower starting rate than some fixed deals. However, payments can rise if the rate it tracks increases.

Choose a tracker only if your budget can withstand higher payments.

A fixed rate provides certainty for the agreed period. The trade-off is missing immediate savings if rates subsequently fall.

Consider how long you need certainty, alongside moving plans and early repayment charges.

What if mortgage rates change?

See how your monthly payment could change on a tracker, compared with keeping your rate fixed.

Mortgage balance

Remaining term

years

Starting mortgage rate

Uses the same starting rate to show the effect of rate changes. For a tracker, enter Bank Rate plus your lender’s margin.

Fixed and tracker repayment scenarios. Changes are compared with your starting monthly payment. Rate movements are percentage points.
Scenario	Rate	Monthly payment	ChangeMonthly change
Fixed — during your deal 4.75%	4.75%	£1,140	£0/month
Tracker: −1.00 points 3.75%	3.75%	£1,028	−£112/month
Tracker: −0.50 points 4.25%	4.25%	£1,083	−£57/month
Tracker: rates unchanged 4.75%	4.75%	£1,140	£0/month
Tracker: +0.50 points 5.25%	5.25%	£1,198	+£58/month
Tracker: +1.00 point 5.75%	5.75%	£1,258	+£118/month
Tracker: +2.00 points 6.75%	6.75%	£1,382	+£242/month

A fixed rate keeps your payment at £1,140 during your fixed deal, whether Bank Rate rises or falls.

If rates rose by 2 percentage points, could you absorb another £242 a month from your spare income?

Illustration only, for repayment mortgages. Assumes rate changes apply now, with an unchanged tracker margin and no cap or collar. Fixed payments stay unchanged during the fixed deal. Excludes fees and overpayments. Figures are rounded independently to the nearest pound.

What does this mean for first-time buyers?

First-time buyers should assess affordability rather than try to predict the lowest rate.

Compare rent with mortgage payments, but include repairs, insurance and buying costs. There is no guarantee that waiting will make buying cheaper.

Equally, higher rates do not automatically make today’s properties bargains.