A good mortgage rate in the UK depends on your deposit size, deal length, and personal circumstances. In 2026, rates between 3.5% and 4.5% are competitive for most borrowers. Historically, UK mortgage rates have averaged 5–7%, making current rates below that average.
What Is a Good Mortgage Rate in the UK Right Now?
In March 2026, here's what a "good" mortgage rate looks like for different scenarios:
| Scenario | Good Rate (2-Year Fix) | Good Rate (5-Year Fix) |
|---|---|---|
| 60% LTV (40% deposit/equity) | 3.5–3.7% | 3.7–3.9% |
| 75% LTV (25% deposit/equity) | 3.7–4.0% | 3.9–4.2% |
| 85% LTV (15% deposit/equity) | 4.0–4.3% | 4.2–4.5% |
| 90% LTV (10% deposit/equity) | 4.2–4.5% | 4.4–4.7% |
| 95% LTV (5% deposit) | 4.5–5.0% | 4.7–5.2% |
The rate you're offered depends on your loan-to-value ratio, credit history, income stability, and the lender. Compare the best mortgage deals available in the UK right now.
Is 4.2% a Good Mortgage Rate?
It depends on your circumstances. A 4.2% rate is:
- Good if you have a 10–15% deposit, are a first-time buyer, or have some credit issues
- Average if you have a 25% deposit and a clean credit history
- Above average if you have 40%+ equity — you could potentially find rates under 3.8%
By historical standards, 4.2% is actually very competitive. UK mortgage rates averaged 6–7% through most of the 2000s and hit 15% in the late 1980s.
Is 4% on a Mortgage Good? Is 4% Interest High?
No, 4% is not high by historical UK standards. Here's some context:
- 1980s–1990s: Rates regularly exceeded 10–15%
- 2000s: Average rates were 5–7%
- 2010–2021: The ultra-low period — rates of 1.5–3% were common
- 2022–2023: Rates spiked to 5–6% after the mini-budget crisis
- 2024–2026: Rates settled around 3.5–5%
So while 4% feels expensive compared to the 2010–2021 period, it's actually below the long-term average. That said, if you're currently paying 4% or more, it's always worth checking whether you could get a better deal — especially if your LTV has improved since you last fixed. Get a free rate check.
Will Mortgage Rates Drop to 3% Again?
It's unlikely in the short term. The ultra-low rates of 2020–2021 (when some borrowers secured rates below 1%) were driven by exceptional circumstances — near-zero Bank of England base rates during the pandemic.
For rates to return to sub-3% levels, we'd need:
- The Bank of England base rate to fall below 2% (currently around 4%)
- Swap rates (which underpin fixed mortgage pricing) to drop significantly
- Inflation to be consistently low for an extended period
Most economists don't expect this in 2026 or 2027. However, borrowers with large deposits (40%+) may already be able to access rates in the 3.4–3.7% range on the best deals.
Will Mortgage Rates Go Down in 2026 in the UK?
Most forecasters expect modest reductions through 2026. The Bank of England is expected to continue cutting the base rate gradually, which should pull mortgage rates lower — but slowly.
Key factors to watch:
- Bank of England decisions: Each base rate cut of 0.25% typically reduces tracker rates immediately and fixed rates over time
- Global events: The Iran conflict has pushed swap rates higher in early 2026, temporarily increasing some fixed rates
- Inflation data: If inflation stays under control, further base rate cuts are likely
Our advice: don't try to "time" the market. If you need a mortgage now, lock in a competitive rate. If rates drop later, you can remortgage when your deal ends.
How to Get the Best Mortgage Rate
Whatever the market is doing, you can take practical steps to access the most competitive rate:
- Increase your deposit: Every LTV band you cross (95% → 90% → 85% → 75% → 60%) unlocks better rates
- Improve your credit score: Pay down debts, register on the electoral roll, close unused credit accounts
- Use a broker: We compare rates from 90+ lenders — including exclusive deals not available on comparison websites
- Consider fixed vs tracker: If you believe rates will fall, a tracker might save you money
- Compare total cost: A lower rate with a £999 fee may cost more than a slightly higher rate with no fee
Read our full guide on how to get a lower mortgage rate.
Frequently Asked Questions
- Is 4.2% a good mortgage rate?
- It depends on your deposit and circumstances. For a 90% LTV (10% deposit), 4.2% is competitive. With 25%+ deposit, you may find better. By historical standards (average 5–7% in the 2000s), 4.2% is below average and considered reasonable.
- Is 4% on a mortgage good?
- Yes, 4% is a competitive rate by historical standards. While it's higher than the ultra-low rates of 2020–2021, it's well below the long-term UK average. Borrowers with larger deposits may find rates in the 3.5–3.8% range.
- Will mortgage rates drop to 3% again?
- It's unlikely in the near term. Sub-3% rates were driven by near-zero base rates during COVID. Most economists expect rates to settle in the 3.5–4.5% range for the foreseeable future, though borrowers with 40%+ equity can sometimes access sub-3.5% deals.
- Will mortgage rates go down in 2026 in the UK?
- Most forecasters expect modest reductions through 2026 as the Bank of England continues gradual base rate cuts. However, global events like the Iran conflict have caused some temporary increases. Don't try to time the market — lock in a good rate when you can.
- What is a good mortgage rate in the UK right now?
- In March 2026, a good rate is 3.5–4.0% for borrowers with 25%+ deposit, and 4.0–4.5% for those with 10–15% deposit. Five-year fixes tend to be slightly higher than two-year deals. Use a broker to compare the best rates from 90+ lenders.
- Is 4% interest high?
- No. While 4% feels higher than the exceptional 1–2% rates of 2020–2021, it's actually below the long-term UK average. Rates exceeded 10% in the 1980s and averaged 5–7% through the 2000s. At 4%, your mortgage is priced competitively.
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