UK mortgage rates have fallen again this week, with several major lenders cutting rates on two-year and five-year fixed-rate deals. The drops come as the market continues to price in expectations of further base rate movements, creating better opportunities for first-time buyers and those looking to remortgage.

What the rate cuts mean today

Major UK lenders have reduced rates across a range of fixed-rate mortgage products, with cuts of between 0.10 and 0.25 percentage points on selected deals. Two-year fixed rates are now available from around 4.5% for borrowers with a 25% deposit, while five-year fixes start from approximately 4.2% at similar loan-to-value ratios. According to the Bank of England, the base rate currently sits at 4.75%, and market pricing suggests further easing may be on the horizon.

These reductions matter most for anyone coming to the end of a fixed-rate deal and facing reversion to a standard variable rate (SVR), which typically sits 2 to 3 percentage points higher than new fixed deals. A £200,000 mortgage on a 25-year term could see monthly payments drop by £80 to £100 by switching from an SVR to a new five-year fix at current rates (as of June 2026; rates change frequently, verify current terms with an FCA-authorised lender or adviser before deciding).

What is driving rates down

The recent cuts reflect lenders competing for business as funding costs ease and swap rates (the rates lenders pay to borrow money themselves) trend lower. Broader economic signals, including moderating inflation and cooling wage growth, have shifted market expectations around the Bank of England’s next moves. While the base rate has not moved yet, lenders price mortgages on their outlook for the next two to five years, not just today’s base rate.

What to do if you are buying or remortgaging

If your current fixed-rate deal ends within the next three to six months, now is a good time to secure a new rate. Most lenders allow you to lock in a deal up to six months before your current deal expires without penalty. This is known as a product transfer (staying with your current lender) or a remortgage (switching to a new lender). Early repayment charges (ERCs) usually apply if you leave your deal early, so check your mortgage statement for your deal end date and any ERC period.

Read also: Mortgage Interest Rates Today: Fixed Rates Edge Lower as Tracker Mortgages Remain Volatile

First-time buyers should compare the total cost over the deal period, not just the headline rate. A slightly higher rate with a lower arrangement fee can work out cheaper overall on a smaller loan, and rates vary significantly by loan-to-value band. As MoneySavingExpert advises, make sure you understand the full terms, including what happens when the deal period ends and the mortgage reverts to the lender’s SVR.

What to be careful about

Eligibility, limits, fees, and availability vary by lender, product, and your personal circumstances. Rates can change daily, and the best deals may have limited availability or higher affordability requirements. Tracker mortgages, which follow the Bank of England base rate directly, may look attractive if you expect further rate cuts, but they carry the risk of rising again if the base rate moves up.

Your home may be repossessed if you do not keep up repayments on your mortgage.

This information is general educational guidance, not regulated mortgage advice, and not personalised financial or lending advice. Refisage is not authorised by the Financial Conduct Authority (FCA). Before making any mortgage or remortgage decision, consider speaking to an FCA-authorised mortgage adviser who can assess your personal circumstances. More guidance is available from MoneyHelper.