The short answer
A fixed mortgage keeps its interest rate unchanged for the deal period, so scheduled payments are predictable. A tracker is variable and normally follows a published reference rate, commonly the Bank of England base rate, plus a stated margin. Its payment can fall or rise. Neither is automatically cheaper: compare the full deal cost and the consequences of the rate moving.
How a fixed rate works
The rate is fixed for a stated period—not usually for the full mortgage term. When the deal ends, you normally move to the lender’s standard variable rate unless you switch. Fixing can make budgeting easier, but early repayment charges may apply if you leave, repay or exceed an overpayment allowance during the deal.
How a tracker works
A tracker’s contract identifies what it follows and the margin. If a tracker is base rate plus 0.75 percentage points, a 0.25-point base-rate change would normally produce the same change in the mortgage rate. Check for a collar or minimum rate, how quickly changes take effect, the deal length and any exit charge.
Compare scenarios, not forecasts
Calculate the payment at today’s tracker rate, then at least one and two percentage points higher. Ask whether those payments would still leave room for essential spending and savings. For a fix, include its fee, the balance left at the end, and the possible cost of leaving early.
A practical checklist
- How valuable is a known monthly payment to your household?
- Could you afford a meaningful rate rise without relying on credit?
- Are you likely to move, overpay heavily or change the mortgage early?
- What product, valuation, legal and advice fees apply?
- What rate follows the introductory deal?
- Does the tracker contain a collar, cap or unusual variation clause?
Test payments in the mortgage calculator and compare switching costs with the remortgage break-even calculator.
Sources and limitations
See MoneyHelper’s mortgage interest-rate options. Product terms and eligibility vary. This guide explains mechanics and is not a rate forecast or mortgage recommendation.
Reviewed by the Properties & Homes editorial team
Published and last reviewed: 14 August 2026.
Change log: first edition.