Comparing a 5.87% two-year fixed mortgage in Birmingham

D

DirectCairn

Homeowner
Established
The quote has now come back at 5.87% fixed for two years, which leaves me wondering whether the headline rate is even the right starting point. The Birmingham purchase is around £335,400, but the fee and the applicable loan-to-value band materially affect the amount needed and the cost of borrowing.

Would it be clearer to put each mortgage on the same 24-month comparison: upfront cash, payments, lender charges and the balance remaining when the fix ends? I also want to test whether a slightly larger deposit reaches a better band. Beyond price, the monthly payment must remain manageable if rates reset, and portability or repayment restrictions could matter if plans change before two years.
 
For a two-year fix, I would compare each offer over the same two-year period: payments made, arrangement fee and other lender charges, plus the mortgage balance remaining at the end. APR can be misleading if you expect to refinance when the fix ends because it reflects a longer assumed borrowing period. Keep affordability as a separate test, especially for the rate reset.
 
What loan amount are you actually seeking, and will the arrangement fee be paid upfront or added to the mortgage? The £335,400 purchase price alone does not identify the loan-to-value tier. A slightly larger deposit might move the application into another tier, while adding the fee to the loan means paying interest on it too.
 
That helps. I was comparing the headline rates without giving enough weight to the balance left after 24 months. I’m now confirming the exact loan amount and whether the fee would be added or paid upfront, then I’ll put the offers into one two-year comparison. I’ll also test the payments at a higher post-fix rate rather than relying on a favourable refinance.
 
I would not give portability too much value unless a move is genuinely likely. It may not mean you can transfer the mortgage automatically to any future property; circumstances and lender requirements at that time can matter. Early-repayment terms are more concrete, so check the charge periods and permitted overpayments in the actual offer. Also compare a no-fee option if available—the lower rate is not necessarily cheaper over only two years.
 
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