Why the payment changes when a fixed rate ends
A repayment mortgage is set up so that the balance reaches zero at the end of the term. When your fixed deal ends, the lender works out a new payment that still clears the balance you owe on that day over the years you have left, at the new rate. So the payment changes for two reasons at once: the rate is different, and the sum is done on a smaller balance over a shorter term. If the new rate is higher the first effect usually wins and the payment jumps; if it is lower the payment can fall.
On a £200,000 mortgage at 4.5% over 25 years, the payment is £1,111.66. After a five-year fix you would owe £175,716 with 20 yrs to go. If you did nothing and moved to a variable rate of, say, 7.5%, the payment would become £1,415.56. On a new deal at, say, 5%, it would be £1,159.65. Those two rates are assumptions to show the mechanics; enter your own lender's figures above.
Calculated with the same engine as the calculator. Rates after the deal are assumptions, not forecasts.
Your three options when the deal ends
- Do nothing. You move to the lender's standard variable rate (SVR). No fees and no paperwork, you can usually overpay without limit, and you can leave at any time. It is almost always the most expensive rate, so it suits people who are about to sell or repay, not people staying put.
- A new deal with your lender (product transfer). Usually quick, often without a new affordability check, and sometimes without a valuation or legal work. You can normally choose it a few months before the current deal ends.
- A new deal with another lender (remortgage). Takes longer and may involve fees, a valuation and conveyancing, but opens up the whole market. Worth comparing against your own lender's offer, fees included.
Our guide what happens when your fixed rate ends goes through the timeline, the fees to compare, and when you can lock in a rate.
Overpay now, pay less later
Because the new payment is worked out on the balance at the end of the deal, overpaying during the fix lowers it twice over: less balance to repay, and less interest on it. Overpaying £200 a month during the five-year example fix takes the balance at the end from £175,716 to £162,287, and the payment at 7.5% from £1,415.56 to £1,307.37. Most deals allow up to 10% a year without a charge; the mortgage overpayment calculator checks your allowance and the early repayment charge on anything above it.
If the new payment is more than you can manage
Talk to your lender before you miss a payment. Options can include a longer term (lower payment, more interest overall), a temporary switch to interest-only, or a different deal. Lenders are expected to offer support to borrowers in difficulty, and asking about options does not by itself affect your credit file; an arrangement that reduces or pauses payments can. The calculator lets you try a longer term to see what it does to the payment and to the total interest.
How this calculator works
Interest each month is your balance times the annual rate divided by 12, rounded to the penny. Up to the month your deal ends, the payment is your current one. From the first payment at the new rate, the payment is recalculated so the balance owed then is repaid over the months left, which is what lenders do. The interest figures assume each rate stays the same until the mortgage ends, which is a comparison, not a forecast. Fees, insurance and any product fee added to the loan are not included. See How we calculate.
Related tools and guides
- Mortgage overpayment calculator: your mortgage-free date and interest saved, with the 10% allowance check.
- What happens when your fixed rate ends.
- The 10% overpayment rule and early repayment charges.
- Should you overpay your mortgage or save?
Questions people ask
Why does my payment go up so much when my fixed rate ends?
Two things happen at once: the rate changes, and the lender recalculates the payment so the balance you owe then is repaid over the term you have left. On the £200,000 example, after five years at 4.5% you'd owe £175,716 with 20 yrs to go. At an assumed 7.5% variable rate the payment becomes £1,415.56 instead of £1,111.66; on a new deal at an assumed 5% it is £1,159.65.
What is the standard variable rate?
The standard variable rate (SVR) is the rate your lender moves you to when a fixed, tracker or discounted deal ends and you have not arranged another. Each lender sets its own SVR and can change it at any time; it is usually well above the rates on new deals. Enter your lender's current SVR as the "if I do nothing" rate. It is on your lender's website or your annual statement.
When can I arrange a new deal?
Usually several months before your current deal ends. Many lenders let existing customers choose a new deal (a product transfer) up to about six months ahead, and most offers from a new lender (a remortgage) are valid for some months, so you can lock in a rate and still switch to a better one if rates fall before completion. Our guide on what happens when your fixed rate ends covers the timeline.
Does overpaying before the deal ends lower the new payment?
Yes. The new payment is worked out on the balance you owe when the deal ends, so every pound you overpay before then lowers it. Overpaying £200 a month for the five years of the example takes the balance at the end from £175,716 to £162,287, and the payment at 7.5% from £1,415.56 to £1,307.37. Check your overpayment allowance first; the overpayment calculator does that.
What rate should I enter for after the deal?
Enter the rate you would actually be on. For "if I do nothing", use your lender's current standard variable rate or the rate your offer says you revert to. For "a new deal", use a rate you have been quoted or a current deal rate for your loan-to-value. Nobody knows future rates, so the results are the payment at those rates, not a forecast; try a higher figure to see what you could cope with.
For education and estimates only; not financial, tax or legal advice. Your lender's figures are final. See How we calculate.