By clicking a retailer link you consent to third-party cookies that track your onward journey. This enables W? to receive an affiliate commission if you make a purchase, which supports our mission to be the UK's consumer champion.
The number of mortgage products available to borrowers is at its highest level since October 2007, according to Moneyfacts data.
With so many options, choosing a mortgage can be daunting, whether you are a first-time buyer or a home mover.
Here, we talk to experts and look at the costs of different types of deals to help you weigh up the types of mortgage products worth considering this year.
Find the right mortgage using the fee-free service provided by L&C Mortgages
Compare mortgagesIf you click on the link and complete a mortgage with L&C Mortgages, L&C is paid a commission by the lender and will share part of this fee with Which? Ltd helping fund our not-for-profit mission. We do not allow this relationship to affect our editorial independence. Your home or property may be repossessed if you do not keep up repayments on your mortgage.
The first choice for most borrowers is between a tracker or fixed-rate mortgage.
With a fixed-rate, you have certainty on the monthly costs for the term, but with a tracker, there's potential for your rate to drop if the Bank of England cuts the base rate or for your monthly payments to rise if it increases it.
2025 was a good year for tracker mortgage holders. A borrower with a tracker mortgage taken out in January 2025 will have seen their mortgage rate drop by a full percentage point, following four cuts to the base rate. This saved the average tracker mortgage holder £439.62 during 2025, according to analysis by UK Finance.
Experts anticipate that the base rate will fall further in 2026, with most estimating one or possibly two base rate cuts. However, while tracker rates are expected to fall, they may only drop by 0.25 percentage points, which would still make them more expensive than the best fixed rates currently.
However, another perk of a tracker mortgage is the flexibility. Tracker mortgages typically don't include early repayment charges, which apply if you overpay above a certain amount or switch mortgages before the term of the deal. If you're thinking of moving in the next few years, a deal with no ERCs could save you a significant amount of money.
As of 13 January, we found 6,792 fixed-rate deals on the market, compared with just 375 trackers, so there's much more choice if you decide to fix.
And the good news is that HSBC, First Direct, Halifax, Lloyds Bank and Barclays have begun the year by cutting rates, with Barclays by as much as 0.36 percentage points.
We've found that the impact of the cuts is likely to be felt most by borrowers with smaller deposits, who have a loan-to-value (LTV) of 70% to 90%. For example, the lowest rate for first-time buyers with just a 5% deposit has dropped by 0.05 percentage points since the start of the year.
The most popular fixed-rate products are typically two or five-year terms.
The three key considerations for borrowers are the cost, your attitude to risk and your future plans.
Currently, borrowers will typically find the cheapest deal with a two-year fix, with rates generally increasing the longer you fix for.
A shorter mortgage term gives you the flexibility to switch to a new deal sooner, potentially at a lower rate, but there’s always the risk that rates won’t fall, or could even rise. While a five-year fix gives greater certainty but will typically come with a slightly higher rate.
Recently, borrowers have increasingly opted for three-year terms, perhaps because they offer a little extra security, albeit at a lower rate than five-year fixes.
When choosing the term length, it's also important to consider your future plans. If you think you'll move home sooner, a shorter-term deal could be more suitable, as you'll likely face early repayment charges if you move home during your fixed term.
Whatever mortgage you choose, it is important to consider the entire package rather than just the headline rate.
Nicholas Mendes, of mortgage broker John Charcol, points out that 'fees, early repayment charge structures, and how long a borrower expects to hold the mortgage often matter more than a few basis points on day one'.
For him, fixed rates make the most sense right now: '[Tracker mortgages] can work for borrowers who are comfortable with payment variability and want to keep optionality, particularly where early repayment charges are low or absent. However, given where fixed rates are currently priced versus base rate, a tracker isn't automatically the cheaper choice, and the risk-reward balance needs to be assessed carefully.'
David Hollingworth, of mortgage broker London and Country, told Which?: 'Tracker rates could start to become more popular, but borrowers do need to prepare for the fact that rate predictions can change. They are better suited to those who are happy with the risk of rates rising and would have the ability to absorb a rise in monthly payments. They're more likely to appeal to those with an existing mortgage looking for a new deal than they are to a first-time buyer, where budgeting certainty is likely to be a priority.'
The mortgage product you choose can significantly affect your monthly mortgage costs.
To illustrate this, we’ve calculated the estimated monthly costs of the cheapest two-year tracker, as well as the cheapest two-year, three-year, five-year and 10-year fixed rates, at three different LTV levels, for a £250,000 mortgage over 25 years.
| Two-year tracker monthly payment | Two-year fixed-rate monthly payment | Three-year fixed-rate monthly payment | Five-year fixed-rate monthly payment | 10-year fixed-rate monthly payment | |
|---|---|---|---|---|---|
| 60% | £1,300.34 | £1,247.54 | £1,265.01 | £1,279.89 | £1,368.38 |
| 75% | £1,316.83 | £1,254.24 | £1,277.18 | £1,289.41 | £1,368.38 |
| 90% | £1,381.08 | £1,314.08 | £1,352.95 | £1,341.78 | £1398.11 |
Source: Which? analysis of the cheapest rates sourced from Moneyfacts data on 13 January .
Two-year fixed rates were the cheapest option across all three LTVs, with them £20 to £30 cheaper than five-year fixes at the moment.
The best three-year mortgages typically cost somewhere between the price of a two-year and a five-year fix. However, at the higher LTV ratios, a five-year fix can be slightly cheaper.
Our research shows that across the three LTV ratios we analysed, long-term security comes with a cost, with the 10-year fix being the most expensive across all three LTV ratios. At 60% LTV, the best 10-year fixed rate costs more than £100 extra per month than the cheapest two-year fix.
The table also highlights the price of flexibility. We found that the best tracker mortgage is more expensive than two, three and five-year fixes across all LTV ratios we analysed.
If your home has an EPC rating of A or B, it may be worth considering a green mortgage, as some lenders will offer energy-efficient homes a lower interest rate. Similarly, if you would like to make green home improvements, many providers will offer 0% loans or cashback to mortgage customers.
For example, Nationwide, the only Which? Recommended mortgage lender from our latest survey, offers eligible existing customers a 0% interest Green Additional Borrowing mortgage. The scheme allows you to borrow between £5,000 and £20,000 to fund improvements, such as installing solar panels, adding cavity wall insulation, or installing double glazing. Be aware that the 0% interest applies only to the length of your fixed-term mortgage.
