Fixed or variable rate: the right choice for your loan in 2025

In 2025, choosing between a fixed or variable rate for your home loan may seem confusing, especially in an economic climate where rates are stable after an initial rise at the beginning of the year. So how do you decide which type of rate is best for you? That’s what I’m going to try to help you understand in this article.

UNDERSTANDING THE EVOLUTION OF IMMOBILIER LOAN RATES IN 2025
This year, property rates have been on a bit of a rollercoaster. In June 2025, according to the CAFPI barometer, average rates were 3.04% for 15-year mortgages, 3.15% for 20-year mortgages and 3.28% for 25-year mortgages. These figures contrast with those announced by other players such as Crédit Agricole and Meilleurtaux, which show some interesting variations. For example, Crédit Agricole quotes an average rate of 3.45% for a 20-year loan, while Meilleurtaux quotes slightly lower rates, from 3.14% for a 15-year loan to around 3.35% for a 20-year loan.

CHOOSING A FIXED RATE FOR STABILITY AND PREDICTABILITY
A fixed rate offers the advantage of a constant monthly payment throughout the term of the loan, which is ideal if you want to avoid surprises. In 2025, with fixed rates at around 3.3% to 3.5% for terms of 20-25 years, this option remains a safe bet for those looking for stability in the face of a possible rise in rates.

VARIABLE RATES: RISKS AND OPPORTUNITIES
Choosing a variable rate can be tempting if you are hoping for a fall in interest rates. In 2025, the 3-month Euribor is at 2.01% and rising, adding a risk factor to this option. However, variable loans are often capped, limiting the rise in rates and thus limiting any unpleasant surprises. This option could be interesting if you plan to repay quickly or if you have a good risk tolerance.

THE MIXED RATE OPTION
The mixed-rate loan combines the best of both options: an initial fixed rate, often for 7 to 10 years, followed by a capped variable rate. This solution seeks to offer a compromise between security and flexibility.

LIST OF ADVANTAGES AND DISADVANTAGES
– Advantages of a fixed rate: stability, predictability, security.
– Disadvantages of a fixed rate: Impossible to take advantage of any rate cuts.
– Advantages of a variable rate: Potential for lower monthly payments, flexibility.
– Disadvantages of a variable rate: Risk of higher monthly repayments if Euribor rises.

In 2025, the choice between a fixed rate or a variable rate for your home loan largely depends on your risk tolerance and your economic forecasts. Fixed rates offer reassuring security for those who want to avoid market fluctuations. However, if you’re prepared to take a few risks, a variable rate can offer you potential savings, especially if you’re looking to pay it off quickly. Feel free to share your thoughts on this issue below and sign up for our newsletter to receive financial advice straight to your inbox.

FAQ

What is the best choice between a fixed or variable rate in 2025 ?

That depends on your profile, your risk tolerance and your personal forecasts. The fixed rate is generally recommended for those who want to minimise the uncertainties associated with rate fluctuations. How does a mixed-rate loan work? It starts with a fixed rate for an initial period (often 7 to 10 years), then becomes a capped variable rate, combining elements of both types of rate.What does it mean if Euribor rises? If Euribor rises, this can lead to higher monthly payments on variable-rate loans, increasing the cost of borrowing.

In 2025, is it better to choose a fixed or variable rate for a home loan?

The choice between a fixed and variable rate in 2025 largely depends on your risk tolerance and economic forecasts. A fixed rate offers security and predictability, while a variable rate can offer potential savings if rates drop.

What were the average property loan rates observed in June 2025 according to the CAFPI barometer?

In June 2025, the average rates were 3.04% for 15-year mortgages, 3.15% for 20-year mortgages, and 3.28% for 25-year mortgages, according to the CAFPI barometer.

What are the advantages of opting for a fixed rate?

The advantages of a fixed rate include stable monthly payments, budget predictability, and security against a potential rise in rates.

What are the risks associated with a variable rate?

The main risk of a variable rate is an increase in monthly payments if the Euribor rises. However, variable loans are often capped, which limits this increase.

What is a mixed-rate loan?

A mixed-rate loan combines the best of both options: it starts with a fixed rate (often for 7 to 10 years), followed by a capped variable rate. This offers a compromise between security and flexibility.

When might a variable rate be advantageous?

A variable rate could be advantageous if you plan to repay your loan quickly or if you have a good risk tolerance and hope for a decrease in interest rates.

A loan is a commitment.

A loan is a commitment and you must repay it. Check your financial capacity before taking on debt. This is more than just advice, it is a fundamental principle of responsible financial management, which is why this statement is a legal requirement on all credit advertisements. We have also included it with our approvals and certifications.

This sentence perfectly sums up the risk:

The commitment: A loan is not a gift, it is a contract that creates a legal obligation to repay.

Verification (repayment capacity): This is the step that many people overlook. It involves honestly analyzing your fixed income, your unavoidable expenses (rent, bills, other loans), and assessing whether you have enough “disposable income” left to cover the new monthly payment, even in the event of unforeseen circumstances.

Ignoring this warning is a direct path to excessive debt. This is an essential message of caution that we would like to remind you of.