Where Are Mortgage Rates Heading in the UK?

Interest rate trends and comparative mortgage examples for foreign investors.
Are mortgage costs falling, what is the latest situation in fixed-rate loans?

What is the Bank of England Interest Rate Direction?

Bank of England (BoE), July-August 2025 fifth annual interest rate cutthe policy rate by realising the %4.25 to %4.00 dropped it.

• Interest rates at the end of 2025 to levels of approximately %3,75 may come down, but this depends on economic and inflation data. Fixed-rate mortgage rates are falling, albeit slowly.

• Floating rate loans and those who receive their payment on a base (especially SVR) still face high costs.

• Short-term fixed loans (2 years and less)The cost of long-term fixed loans remains cheaper than long-term fixed loans, which may offer opportunities for short-term investment or restructuring (remortgage).

UK Mortgage Interest Rates for Foreign Investors

• According to platforms such as WeAreMoney, mortgage rates available to foreign investors usually %3 - %6 between the loan score and the down payment amount. This rate may vary according to the credit score, down payment amount and the applicant's background.

• An exemplary product offered by HSBC: 2 years fixed interest: %5.54(%6,74), followed by a variable interest rate (SVR). Such agreements are typical offers for expats and foreign international clients.

• Expats are generally offered fixed interest rates for foreigners from countries such as Turkey about %4,33 competitive levels, while the APRC for total reimbursements is approximately %5.9-%6.5 around here.

Comparison with Standard (within the UK) Rates

By 2025:

• 2 years fixed mortgage: ~%4,57

• 5 years fixed mortgage: ~%4,54

In this framework, interest rates for foreign investors usually about 0.5-1 points higher levels.

Why Are Interest Rates Higher for Foreigners (Non-UK)?

Some factors explain this difference:

• Failure to Evaluate Credit History: Security weaknesses in foreign credit records increase the risk.
• Higher Down Payment Requirement (LTV reduced): Lenders often ask expats to leave to reduce risk en az %25–%40 demands a deposit.
• Limited Documentation and HR Rating: Stricter conditions may apply, especially for applicants with a work visa or limited residence information.