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Compare · Two-year fix vs Five-year fix

Two-year fix vs five-year fix mortgage — which is right for you?

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In short. A two-year fix gives short-term payment certainty and lets you remortgage sooner — useful if you expect rates to fall. A five-year fix locks in your rate for longer, with bigger early repayment charges if you leave early.

Both are 'fixed-rate' mortgages in the UK — your interest rate doesn't move during the deal period. The trade-off is how long you want to lock in versus how often you want the freedom to remortgage.

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Side by side

Length of fix

Two-year fix

Two years

Five-year fix

Five years

Rate level

Two-year fix

Usually slightly higher or lower than 5-year, depending on the yield curve

Five-year fix

Often priced off longer-term swap rates

Payment certainty

Two-year fix

Short

Five-year fix

Medium-term

Early repayment charge (ERC)

Two-year fix

Typically 1–2% in years 1–2

Five-year fix

Typically 5% reducing to 1% across years 1–5

Refinancing cost frequency

Two-year fix

Every 2 years (product/valuation/legal fees)

Five-year fix

Every 5 years

If rates fall

Two-year fix

Can remortgage sooner to a cheaper deal

Five-year fix

Locked in (ERC applies)

If rates rise

Two-year fix

More frequent renewal risk

Five-year fix

Protected for longer

When Two-year fix usually wins

  • You think rates will fall over the next 2–5 years
  • You may want to move home or change product soon
  • You want lower ERCs if circumstances change
  • You're happy to absorb remortgage fees more often

When Five-year fix usually wins

  • You want long-term payment certainty
  • You don't plan to move or significantly change the loan
  • You want to avoid frequent remortgaging costs
  • You're risk-averse to rate rises

Related quick answers

FAQ

Can I overpay during a fixed period?
Most fixed-rate mortgages allow penalty-free overpayments of up to 10% of the balance each year. Above that, the early repayment charge usually applies. Check the offer document.
What is the ERC if I leave a five-year fix early?
Typically a tiered percentage of the outstanding balance — for example 5% in year 1, falling by 1% each year to 1% in year 5. Each lender's schedule is different.
Are there fixes longer than five years?
Yes — 7, 10 and even 30-year fixes exist in the UK, though far less common. Trade-off is even longer ERC commitment.
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