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3 Year Fixed Rate Mortgages

Details sort by initial rateLenderInitial rate Rate type Overall cost for comparison Product fee Monthly cost Enquire
Initial rate: 4.22%
Rate type: 2 year fixed
Monthly cost: £810.09 per month
Product fee: £999
Overall cost for comparison: 7.1% APRC
Nationwide Building Society logo 4.22% 2 year fixed 7.1% APRC £999 £810.09 per month get quotes Broker Only Deal
Initial rate: 4.22%
Rate type: 2 year fixed
Monthly cost: £810.09 per month
Product fee: £899
Overall cost for comparison: 6.4% APRC
Barclays 4.22% 2 year fixed 6.4% APRC £899 £810.09 per month get quotes Broker Only Deal
Initial rate: 4.23%
Rate type: 2 year fixed
Monthly cost: £810.93 per month
Product fee: £899
Overall cost for comparison: 6.4% APRC
Barclays 4.23% 2 year fixed 6.4% APRC £899 £810.93 per month get quotes Broker Only Deal
Initial rate: 4.23%
Rate type: 2 year fixed
Monthly cost: £810.93 per month
Product fee: £999
Overall cost for comparison: 7.7% APRC
Halifax 4.23% 2 year fixed 7.7% APRC £999 £250 cashback £810.93 per month get quotes
Initial rate: 4.23%
Rate type: 2 year fixed
Monthly cost: £810.93 per month
Product fee: £999
Overall cost for comparison: 7.7% APRC
Halifax 4.23% 2 year fixed 7.7% APRC £999 £250 cashback £810.93 per month get quotes Broker Only Deal
Initial rate: 4.25%
Rate type: 2 year fixed
Monthly cost: £812.61 per month
Product fee: £999
Overall cost for comparison: 7.7% APRC
Lloyds Bank 4.25% 2 year fixed 7.7% APRC £999 £250 cashback £812.61 per month get quotes
Initial rate: 4.27%
Rate type: 2 year fixed
Monthly cost: £814.29 per month
Product fee: £999
Overall cost for comparison: 7.1% APRC
Nationwide Building Society logo 4.27% 2 year fixed 7.1% APRC £999 £814.29 per month get quotes Broker Only Deal
Initial rate: 4.27%
Rate type: 2 year fixed
Monthly cost: £814.29 per month
Product fee: £995
Overall cost for comparison: 7.2% APRC
NatWest logo 4.27% 2 year fixed 7.2% APRC £995 £814.29 per month get quotes
Initial rate: 4.28%
Rate type: 2 year fixed
Monthly cost: £815.13 per month
Product fee: £999
Overall cost for comparison: 6.8% APRC
Coventry Building Society logo 4.28% 2 year fixed 6.8% APRC £999 £815.13 per month get quotes Broker Only Deal
Initial rate: 4.32%
Rate type: 2 year fixed
Monthly cost: £818.5 per month
Product fee: £999
Overall cost for comparison: 6.7% APRC
HSBC logo 4.32% 2 year fixed 6.7% APRC £999 £750 cashback £818.5 per month get quotes Broker Only Deal
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Representative Example:

A repayment mortgage of £120,000 payable over 28 years and 1 month initially on a fixed rate for 2 years at 1.99% and then on the lender current variable rate of 3.69% (variable) for the remaining 26 years and 1 month would require 24 monthly payments of £465.20 and 312 monthly payments of £565.39 and one final payment of £565.19.

 

The total amount payable would be £189,357.67 made up of the loan amount plus interest (£68,161.67), booking fee (£999), completion fee (£30) and valuation fee (£197).

 

In this example the overall cost for comparison is 3.7% APRC representative.

 

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT

3 Year Fixed Rate Mortgages

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3 year fixed rate mortgages

3 year fixed rate mortgages

The Bank of England base rate has been held at 0.5% since March 2009, and many experts predict it won’t rise again until 2015 – so could a 3 year fixed rate mortgage be a good choice for you while interest rates remain low?

You would certainly be in good company – according to recent statistics from the Council of Mortgage Lenders, 88% of people who took out a mortgage in November 2013 opted for a fixed rate. So why are fixed rate mortgages such a popular option and what are the benefits and drawbacks of a 3 year fixed rate?

Advantages of a 3 year fixed rate mortgage

  • A compromise between long term and short term fixed rates - Three year fixed rate mortgages offer a compromise between a variable rate or a short term deal like a 2 year fixed rate mortgage, and a longer term fix for 5 or 10 years. This could offer you the best of both worlds to some extent – on the one hand, you’ll be able to benefit from the security of a fixed rate , but you only need to commit to this for 3 years and can move on to a different mortgage deal after the term finishes. With a longer term fixed rate, on the other hand, you could find yourself facing early repayment charges (ERCs) if you wanted to leave your current deal after three years.

  • Easy to understand – If you are new to home ownership, a fixed-rate mortgage is an easy concept to understand as it is based on a stable monthly repayment, like a standard bank loan of the type you may have taken out previously.

  • Easy budgeting – if you are not sure what life may throw at you over the next three years, a fixed rate for this period of time could offer significant peace of mind as you know exactly how much you will need to pay each month.

Disadvantages of a 3 year fixed rate mortgage

  • If the base rate were to fall further, you could stand to miss out on lower payments – if you fix your mortgage for three years and the base rate falls further, you could lose out compared to homeowners with a base rate tracker mortgage. While this may not be of prime concern to buyers during the current rock-bottom base rate and the unlikelihood of a further fall, it’s still worth considering as part of the longer term picture. Many experts predict that interest rates will start to rise in 2015, so a three year fixed rate could buy you some extra time to benefit from the current record low rate.

  • Penalty charges if you want to leave the deal before 3 years are up – Most mortgage providers will charge you a penalty - known as an Early Repayment Charge (ERC) - if you want to move to a different mortgage deal before the end of the fixed term. For example, if you take out a fixed rate mortgage, repaying the loan early could involve a percentage of the loan amount being charged as a fee, on top of the amount you owe.

If you are searching for a suitable 3 year fixed rate mortgage, you may wish to see our mortgage comparisons table for information on the various offers available – you can instantly search and compare 5,000 mortgage deals to help you find the right one for you.

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