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Is A Fixed Rate Or Tracker Mortgage Better in 2023?

Updated: Jan 13, 2023

We compare the most competitive rates available currently for fixed and tracker rate Buy To Let mortgage products in light of the recent interest rate increase by the Bank of England which currently stands at 3.50% and is projected to rise further at the next MPC Meeting on the 2nd of February 2023.

Alongside looking at the rates, we run through the pros and cons of fixed-rate mortgages compared to trackers.

The Following Topics Are Covered

What Is A Fixed Rate Mortgage?

A fixed mortgage has an interest rate that is guaranteed over a predetermined period of time.

As a result, for the duration of your fixed term, the interest rate you pay on your loan won't change.

This only refers to the term of your current agreement, not the entire 25-year or longer mortgage term, which may apply.

How Long Does A Fixed-Rate Mortgage Last?

Mortgages with fixed rates can be obtained with a variety of different terms, but the majority have fixed terms of two or five years.

Some lenders also offer three-year fixed rates, and in response to the UK's protracted low-interest rates before 2022, fixed-rate mortgages for as long as ten years have grown in popularity.

What Are The Current Interest Rates on Buy To Let Properties?

As of 12th Jan 2023 the following interest rates on Buy to Let Properties are being offered:

Lifetime Tracker

at 5.49% including BOE Rate

2 Year Fixed Rates


5 Year Fixed Rates


75% Loan to Value

75% Loan to Value

75% Loan to Value

2% Product Fee

2% Product Fee

2% Product Fee

ERC: 1% Years 1 and 2. No ERC thereafter

ERC: 4 % Year 1, 3% Year 2

ERC: 4 % Year 1, 3% Year 2, 2% Year 3, 1% Year 3 and 4

Minimum Loan Size: £60,000

Minimum Loan Size: £60,000

Minimum Loan Size: £60,000

What Happens At The End Of Of A Fixed Rate Term?

Your mortgage will return to your mortgage lender's SVR( Standard Variable Rate) after the duration of your fixed rate term. Compared to a fixed or tracker interest rate, this rate is typically much higher.

To avoid paying exorbitantly high-interest rates on an SVR mortgage, you are able to switch your mortgage from your current lender to a new product or remortgage at this time.

What is Tracker Rate Mortgage?

A mortgage with an interest rate connected to the base rate of the Bank of England is known as a tracker mortgage.

A tracker mortgage, for instance, has an interest rate that will always be 0.75 percent higher than the Bank of England base rate.

Your monthly mortgage payments will rise as the base interest rate rises. They will decline as the base rate falls. For the duration of your tracker mortgage term, the difference of 0.75 percent won't change.

What Are The Pros and Cons Of A Fixed Rate Mortgage?


  • You are fully aware of the amount you will need to pay back over the fixed term every month

  • No matter how the base rate changes, in instances, when it rises your mortgage is not affected during your fixed term.


  • If the base rate remains low or declines, you might be paying more interest than you would on a tracker mortgage

  • The longer your fixed term, the higher the interest rate you'll have to pay

What Are The Pros and Cons Of A Tracker Rate Mortgage?


  • If the base rate declines or remains the same, you might be able to pay less than fixed-rate products.


  • Throughout your term, your mortgage payments may rise or fall.

What Is The Projection Of Interest Rates and Inflation in 2023?

To stop rising inflation, analysts predict that the BoE will keep raising interest rates at least until December of this year before pausing as high rates begin to have an impact on economic growth.

The bank rate, according to the BoE, would reach a peak of 5.2% in the fourth quarter of 2023 before declining to 2.5% and 2.2%, respectively, in 2024 and 2025.

According to the latest monetary policy report, inflation is expected to fall sharply by the middle of next year back edging closer to the 2% target. Reasons for this are the price of energy is not expected to rise so rapidly coupled with the slowdown in demand for goods and services which has put pressure on prices.

Keep in mind that predictions made by analysts can be inaccurate.

Further Reading


This article is intended to provide a general understanding of the topic. The contents should not be treated as advice.

Accelerated Finance Limited only considers applications for commercial or investment properties.

Accelerated Finance Limited is not regulated by the financial conduct authority and only provides unregulated loans via our network of lenders. Your property is at risk if you fail to make payments on a Mortgage Contract.

Please note that Accelerated Finance Limited and its employees do not give financial advice or recommendations on any product.

Author: Aakash Nagrani - Director 

Aakash Nagrani Author
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