Fixed or Variable Rate Mortgage: Make the Right Choice for Your Home Loan
You’re planning to buy a property, a plot of land, carry out renovation work, or improve your home. One of the most important decisions you’ll have to make is the type of interest rate for your mortgage: fixed rate or variable rate. Understanding the impact of each option on your monthly payments and long-term budget is essential before you sign anything.
In today’s context of historically low mortgage rates, choosing the right structure can protect you against future rate hikes or, on the contrary, allow you to take advantage of potential decreases. Discover how to secure your project with a strategy aligned with your profile and your financial plans.
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Mortgage interest rates remain at particularly attractive levels in 2026, but the trend over the coming years is uncertain. Choosing the right rate type now allows you to:
- Protect yourself against possible rate increases
- Control your budget over the entire duration of the loan
- Optimise the cost of your financing according to your situation
A personalised analysis remains the best way to determine whether a fixed or variable rate is best suited for your real estate project.
Why are mortgage interest rates so low in 2026?
The effects of recent economic and financial crises are still being felt in Europe. To support investment and relaunch lending activity, financial institutions have, over the years, maintained very low mortgage rates. Central banks’ monetary policies, combined with competition between banks, have contributed to keeping financing conditions attractive for borrowers.
In Belgium, mortgage interest rates are influenced by the National Bank of Belgium and by the state of public finances. Even though public finances are under pressure, Belgium can still borrow on the markets at very low, and sometimes even negative, rates. This is because the markets consider Belgium to be one of the more solid countries in Europe, thanks in particular to a high savings rate and good solvency guarantees.
For households, this context translates into an opportunity: it is possible to secure long-term financing at particularly favourable conditions, on the condition of choosing the right rate structure from the outset.
Why choose a fixed-rate mortgage?
With mortgage loan interest rates at historically low levels, a fixed rate offers strong protection for borrowers who prefer stability and visibility. Over the typical duration of a mortgage (often 20, 25 or even 30 years), many economic events can occur and lead to rate increases. By opting for a fixed rate, you lock in today’s attractive conditions for the entire duration of your loan. Learn more about different mortgage solutions.
This means your monthly instalments will remain identical over time, which greatly facilitates long-term budget planning. For households with limited room for manoeuvre or those who want peace of mind, this rate structure is often the most reassuring and prudent.
In a context where future rate trends are more likely to move upwards than downwards, securing a low fixed rate in 2026 can be a particularly wise decision.
When to choose a variable-rate mortgage?
A variable rate mortgage becomes especially interesting when interest rates are relatively high at the time you sign your loan. In that kind of scenario, you can reasonably expect rates to fall in the following years, which could lead to a downward adjustment of your instalments according to the terms of your contract.
However, in an environment where rates are already very low, the potential for further decrease is limited, while the risk of an increase over the coming years is real. Your decision should therefore take into account:
- Your tolerance for fluctuations in monthly payments
- Your job stability and income prospects
- The maximum cap provided for in the variable-rate formula
Variable-rate loans may be suitable for borrowers who are comfortable with a certain level of risk and who have sufficient financial flexibility to absorb potential increases.
What makes mortgage interest rates vary?
Mortgage interest rates depend on several macroeconomic and financial factors. The National Bank of Belgium plays a key role by setting reference rates, which are themselves influenced by inflation, economic growth and the state of public finances.
In addition to central bank decisions, banks also take into account:
- The cost at which they themselves borrow on the markets
- The level of competition between financial institutions
- The borrower’s risk profile and guarantees provided
All these elements explain why rates can change over the years and why it is essential to regularly reassess your mortgage strategy, especially when large deviations occur compared to your initial rate.
When is it interesting to refinance your mortgage?
If you previously took out a fixed-rate mortgage and you notice that current rates are much lower, you may consider refinancing your loan to benefit from more advantageous conditions. This operation consists in replacing your existing mortgage with a new one at a lower rate.
To make refinancing truly beneficial, two conditions are generally recommended:
- Wait at least around 7 years after signing your initial contract
- Ensure a rate reduction of at least 1 percentage point
These thresholds help offset the various costs associated with refinancing, such as notary fees and the costs for releasing the existing mortgage registration. A precise calculation is necessary to compare the total gain over the remaining term with the costs to be incurred.
A detailed simulation with a specialist will allow you to see at a glance whether refinancing your mortgage in 2026 is financially relevant in your specific situation.
The benefits of personalised guidance for your mortgage rate
Tailored analysis
Every situation is unique: income, savings, family plans, risk tolerance. A detailed case-by-case study allows us to determine whether a fixed or variable rate is more suitable for your profile and your long-term objectives.
Optimised financing cost
By comparing different scenarios (fixed, variable, mixed structures, different durations), you can reduce the total cost of your mortgage while keeping instalments compatible with your day-to-day budget and future projects.
Security and transparency
A broker explains the mechanisms for revising variable rates, possible caps, and all the financial implications of your choices. You sign your mortgage with full knowledge of the facts, without unpleasant surprises later on.
Take the time to discuss your real estate project with a specialist. Together, you can determine the most relevant rate structure, the ideal duration and, if appropriate, the right time to refinance your existing mortgage. A well-constructed strategy today can save you significant amounts over the lifetime of your loan.