The short answer
When the fixed period ends, your mortgage moves to the follow-on rate set out in your agreement — often a benchmark such as EIBOR plus a margin. Your payment can rise or fall. Reviewing a few months before the end lets you compare staying, switching or a buyout.
How follow-on rates work
- Your agreement defines the follow-on rate, commonly a benchmark rate plus a fixed margin.
- Because the benchmark moves, your payment can change after the fixed period.
When to review
- Start a few months before the fixed period ends.
- Check early-settlement terms and any fees for switching.
Your options
- Stay on the follow-on rate.
- Agree a new fixed rate with your current lender.
- Refinance or buy out the mortgage with a new lender, if the total cost makes sense.
Worked example
Tip: test a follow-on rate in the calculator by adding a fixed period and follow-on rate, to see how your payment could change.