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Two and five-year mortgage rate gap at lowest since 2013 – Moneyfacts

  • 26/01/2021
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Two and five-year mortgage rate gap at lowest since 2013 – Moneyfacts
The gap between the average rate for a two and five-year fixed mortgage was 0.27 per cent last year, the smallest difference recorded since June 2013, according to Moneyfacts data.


This was the year that followed the launch of the Funding for Lending scheme in 2012, which Moneyfacts said suggested the current low base rate environment and heightened borrower demand showed lenders were open for business. 

Last year, the average rate for a two-year fixed last year was 2.28 per cent while a five-year fixed was 2.55 per cent. 

The analysis also revealed that as of today, the difference between the average rates for the two mortgage terms was still nominal with a gap of 0.17 per cent. While there has been an overall increase since last year, the current average rate for a two-year fixed is 2.52 per cent and a five-year fixed is 2.69 per cent. 

Eleanor Williams, spokesperson at, said: Historically, two-year fixed products have been popular with borrowers, however while the economy remains full of uncertainty, some may find themselves ultimately better off with a five-year fixed rate mortgage.  

“Although five-year deals generally carry higher rates than their two-year equivalents – as borrowers are effectively purchasing the longer-term stability and protection from future interest rate increases these provide – with the gap between the two options currently so low, this may be an opportune time to secure the peace of mind a longer-term fixed rate can bring.”

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