When your fixed rate ends: the renewal risk nobody talks about
You lock in a five-year fixed rate at 4.2%. Life continues. Then, five years later, you're automatically moved onto your lender's Standard Variable Rate — currently sitting at 7.5% or more.
On a £250,000 mortgage, that's an increase of roughly £450 a month. Overnight. Without you doing anything.
This is the renewal risk that nobody explains clearly when you take out a mortgage — and it's the one most worth planning for.
What happens at the end of a fixed term
When your fixed deal expires, your mortgage rolls onto the lender's Standard Variable Rate (SVR). The SVR is set by the lender — it's not directly tied to the Bank of England base rate (though it tends to track it loosely upwards and slowly downwards).
SVRs are almost always significantly higher than the deals available on the open market. They exist partly because lenders know that many customers are inert — they stay on the SVR because switching feels complicated.
The solution is simple: don't stay on the SVR. But you have to actively do something to avoid it.
Official guidance
When to start looking for a new deal
Most lenders let you lock in a new mortgage rate up to six months before your current deal ends, with the new rate activating on your renewal date. This means you can shop the market well in advance, without any gap in your deal.
Practically: if your fixed rate ends in October, start looking in April. A mortgage broker can search the market for you, explain whether to fix again or consider a tracker, and handle the paperwork.
If rates fall between now and October, many brokers will renegotiate the deal before it activates. You don't have to commit and then miss a better rate.
Fixed again, or tracker?
On renewal, you face the same choice as when you first bought: fix the rate for security, or take a tracker that moves with the base rate. Our guide on fixed vs tracker covers this in detail.
The short version: if you need payment certainty — because your budget is tight, you have childcare costs, or you'd genuinely lose sleep over rate changes — fix again. If you have flexibility and believe rates are likely to fall, a tracker might save you money. Neither is wrong; it depends on your circumstances.
The stress test, revisited
When you first bought, your lender stress-tested whether you could afford payments at a higher rate. Now's the time to run your own version of that test.
If you renew at a rate 1% or 2% higher than your current deal, what does that mean for your monthly payment? Is that still comfortable? Use the calculator to model different renewal rates — it takes 30 seconds and will clarify your position immediately.
Model different rates side by side to see what your monthly payment looks like at your current rate vs. a potential renewal rate. The rate variation tool shows the difference in pounds.
Try the calculator →