A million homeowners coming off two-year fixed-rate mortgages urged to not slip onto an SVR... or face a bill shock

Around 1,095,905 homeowners who took out mortgages in 2024 face a considerable jump in monthly payments as they come to the end of two-year fixed rates if they don't act, data shows. These homeowners are coming off two-year fixed rate mortgages with an average interest rate of 4.81 per cent, Compare the Market said.These homeowners could see monthly repayments increase by £283 on the average standard variable rate (SVR) based on an average mortgage debt of £200,250.The 1,095,905 figure included 122,526 first-time buyers and 111,349 home movers or second-time buyers. It also included 690,738 homeowners who previously remortgaged with their current provider and 122,832 who remortgaged with a new provider. Any of these homeowners who slip onto their current lender's SVR could see their monthly payments increase to £1,432, again based on an average mortgage debt of £200,250. This is equivalent to paying £17,184 annually compared to £13,788 on their previous two-year fixed rate, meaning they could be paying more than £3,000 extra each year. End of an era: Around 1,095,905 homeowners who took out mortgages in 2024 face a jump in monthly payments as they come to the end of two-year fixed ratesCompare the Market said: 'Homeowners coming off these fixed rate deals will typically have to pay more, despite mortgage rates having generally fallen since 2024, in line with the base rate.'But switching to a new two-year fix could reduce the monthly repayments for these homeowners by up to £286 per month and £3,432 a year, according to the findings. The latest figures from Moneyfacts this week showed the average SVR is now 7.13 per cent, while Bank of England figures show the average two-year fix in July was 4.79 per cent.Unlike fixed-rate mortgages, SVRs are set by individual lenders and are typically higher than most fixed rate deals available on the market. Borrowers are usually free to remortgage before they are moved onto an SVR. So, is it worthwhile reviewing your options before your current deal expires. Laura Pomfret, of Compare the Market, said: 'An extra £283 a month on your mortgage is a significant amount of money for most households.'That's more than £3,000 over the course of a year, so simply rolling onto a higher rate without considering your options could have a real impact on your budget.'She added: 'When a fixed mortgage deal is coming to an end, it's a good opportunity to look at your finances as a whole. 'Understanding what your new repayments could be ahead of time means you can plan for any increase and consider where you might need to adjust your budget.'It's also important not to focus on the interest rate alone. 'Look at what a new deal will actually cost you each month, alongside any product fees or other charges, and consider how that fits into your household finances.'Buyers stumping up more for a deposit Separate data from Zoopla this week showed buyers need to put down £18,200 more than they would have at the start of this year for a deposit in order to counter the impact of higher mortgage rates. Buyers would have to put down a deposit that was £18,200 higher in order to keep their monthly repayments the same as they would have been in January 2026, Zoopla says.Due to the rise in rates, a buyer who could previously afford a £200,000 mortgage while keeping their monthly repayment unchanged, could now only borrow around £182,000 for the same monthly payment. In London, typical buyers need to add £35,500 to their deposit, almost double the national average.But lower house prices mean those in the North East would only need an additional £10,200.Best mortgage rates and how to find them Mortgage rates have shot up again due to inflation triggered by the conflict with Iran reversing hopes that the Bank of England would cut rates. This means those remortgaging or buying a home face higher costs.That makes it even more important to search out the best possible rate for you and get good mortgage advice, whether you are a first-time buyer, home owner or buy-to-let landlord.This is Money's partner L&C can help you with its fee-free mortgage service.> Compare mortgage rates> Find the right mortgage for you To help our readers find the best mortgage, This is Money has partnered with the UK's leading fee-free broker L&C.This is Money and L&C's mortgage calculator can let you compare deals to see which ones suit your home's value and level of deposit.You can compare fixed rate lengths, from two-year fixes, to five-year fixes and ten-year fixes.If you’re ready to find your next mortgage, why not use This is Money and L&C’s online Mortgage Finder. It will search 1,000’s of deals from more than 90 different lenders to discover the best deal for you.> Find your best mortgage deal with This is Money and L&C Mortgage service provided by London & Country Mortgages (L&C), which is authorised and regulated by the Financial Conduct Authority (registered number: 143002). The FCA does not regulate most Buy to Let mortgages. Your home or property may be repossessed if you do not keep up repayments on your mortgage.