Fixed Rate Vs. Tracker Rate Mortgages

When getting a mortgage, one of the key decisions you’ll make is whether to fix your rate or go for a tracker agreement. Both options have their advantages, depending on your finances, homeownership plans, and wider expectations about interest rates.

Here, we explain the difference between fixed-rate and tracker rate mortgages, how they compare, when each option may suit you, and where to find and compare the best fixed deals and tracker rates for your specific circumstances.

What’s the difference between a fixed-rate and a tracker mortgage?

The main difference between a fixed rate and a tracker mortgage is how the interest rate attached to your mortgage behaves over time:

• Fixed-rate mortgage: Your interest rate is locked in for a set period (typically 2, 3, 5, or 10 years). During this time, your monthly mortgage repayments remain the same, regardless of changes to the base rate or broader mortgage market interest rates.

• Tracker mortgage: Your interest rate follows (or tracks) an external benchmark, usually the Bank of England (BoE) base rate, plus a fixed percentage set by the lender. This means your payments can go up or down over time.

Because of this, fixed mortgages offer stability, while tracker mortgages offer flexibility and potential savings if rates fall.

Fixed vs. tracker mortgages compared

Here’s a side-by-side comparison to help highlight the key differences between a UK tracker vs fixed mortgage:

When to choose a fixed-rate mortgage

A fixed-rate mortgage may be more suitable if you value certainty and want to protect yourself from potential interest rate increases.

You might consider fixed-rate mortgage deals if:

• You want predictable monthly payments for easier budgeting

• You’re concerned that interest rates could rise

• You’re stretching your affordability and need stability

• You prefer a “set and forget” approach to your mortgage

Fixed rates are often popular during periods of economic uncertainty, when rates are expected to increase, or if you have the opportunity to lock in a competitive deal.

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When to choose a tracker mortgage

A tracker mortgage may be more suitable if you’re comfortable with some level of risk and want to benefit from potential rate reductions.

You might consider tracker mortgage rates if:

• You expect interest rates to fall or remain stable

• You want a lower initial rate compared to fixed deals

• You value flexibility (such as lower or no ERCs on some deals)

• You’re comfortable managing fluctuating monthly payments

Tracker mortgages can work well if you have some financial flexibility and can absorb potential increases in repayments.

Compare the latest fixed and tracker deals

Whether you’re looking at fixed or tracker mortgages, rates from lenders change frequently, so it’s important to compare the latest deals before making a decision.

Using our free rate comparison tool below, you can check today’s best fixed-rate mortgage deals and top tracker mortgage rates from lenders across the UK. The tool can be adjusted to show either fixed or tracker options depending on your preference.

Simply enter your details, such as your property value, deposit, and the amount you’re looking to borrow, and you can see the most relevant deals available today:

Mortgage comparison calculator

If you’re weighing up fixed versus tracker mortgages, it can be helpful to compare how different rates affect your monthly payments side-by-side.

Using our mortgage comparison calculator below, you can look at two different types of mortgages next to each other to get a clearer picture of how they compare.

Simply input any fixed mortgage rates you’ve found against specific trackers to see the difference in payments over time:

Get independent advice about the right mortgage to choose

Deciding between a fixed-rate and a tracker mortgage can be challenging, especially with rates changing frequently and lenders taking different approaches to pricing and criteria.

Here’s why borrowers across the UK use Money Helpdesk when comparing fixed and tracker mortgage deals:

• Access to experienced mortgage advisors with whole-of-market access

• Support comparing fixed-rate and tracker mortgage options side-by-side

• Compare today’s best rates, including exclusive broker-only deals

• Free initial chat with no obligation to proceed further

If you’d like to compare the latest fixed and tracker mortgage rates or discuss which option is right for you with some tailored guidance, you can get started here.