Remortgaging could save you hundreds of pounds each month and thousands over your mortgage term. This guide explains when it makes sense to switch, how to find the best deal, and what to expect from the process.
For the wider cluster covering product transfers, fixed-rate endings, remortgage timing, fees and switching routes, use the main Remortgaging hub.
Why Remortgage?
Top Reasons to Remortgage
| Reason | Potential Benefit |
|---|---|
| Fixed rate ending | Avoid SVR increase of 2-3%+ |
| Better rates available | Lower payments or pay off faster |
| House value increased | Better LTV = better rates |
| Release equity | Access cash for improvements/other |
| Change terms | Shorter/longer term, different type |
| Consolidate debt | Add debts to mortgage (use cautiously) |
When Remortgaging Makes Sense
| Situation | Likely Worth It |
|---|---|
| Fixed rate ending in 6 months | ✓ Yes, start looking now |
| On SVR | ✓ Yes, likely paying too much |
| Property value up significantly | ✓ Yes, better LTV bracket |
| Need to borrow more | ✓ Yes, if rates good |
| Current rate already competitive | Maybe — compare carefully |
| High early repayment charges | Calculate savings vs costs |
| Circumstances changed significantly | May be harder to qualify |
How Much Could You Save?
SVR vs Fixed Rate Comparison
| Mortgage | SVR (8%) | Fixed (4.5%) | Monthly Saving | Annual Saving |
|---|---|---|---|---|
| £150,000 | £1,101 | £834 | £267 | £3,204 |
| £200,000 | £1,468 | £1,112 | £356 | £4,272 |
| £250,000 | £1,835 | £1,390 | £445 | £5,340 |
| £300,000 | £2,202 | £1,668 | £534 | £6,408 |
| £400,000 | £2,935 | £2,224 | £711 | £8,532 |
25-year term, repayment mortgage. Rates illustrative.
Impact of Improved LTV
| Property Value | Mortgage | LTV | Typical Rate | Monthly (£250k mortgage) |
|---|---|---|---|---|
| £277,778 | £250,000 | 90% | 5.3% | £1,507 |
| £312,500 | £250,000 | 80% | 4.5% | £1,390 |
| £333,333 | £250,000 | 75% | 4.2% | £1,344 |
| £357,143 | £250,000 | 70% | 4.0% | £1,319 |
| £416,667 | £250,000 | 60% | 3.8% | £1,294 |
If your property has risen in value, you may access better rate brackets.
Types of Remortgage
Like-for-Like Remortgage
Move to a new deal for the same mortgage amount.
| Aspect | Details |
|---|---|
| Purpose | Better rate, avoid SVR |
| Amount borrowed | Same as current |
| Equity released | No |
| Affordability check | Standard (may be light for product transfer) |
| Best for | Rate savings |
Remortgage to Borrow More
Increase your mortgage to release equity.
| Aspect | Details |
|---|---|
| Purpose | Home improvements, other spending |
| Amount borrowed | Current mortgage + additional |
| Equity released | Yes |
| Affordability check | Full assessment on total borrowing |
| Best for | Funding large expenses |
Remortgage to Consolidate Debt
Add other debts to mortgage (use with caution).
| Aspect | Details |
|---|---|
| Purpose | Lower monthly payments |
| Amount borrowed | Current mortgage + debts |
| Risk | Turns short-term debt into long-term |
| Interest | Lower rate but paid over 25+ years |
| Best for | Rarely recommended — seek advice |
Product Transfer vs Remortgage
Key Differences
| Factor | Product Transfer | Remortgage (New Lender) |
|---|---|---|
| Lender | Same | Different |
| Application | Simple, often online | Full application |
| Affordability check | Often minimal | Full assessment |
| Legal work | None | Required (often free) |
| Valuation | Usually none | Required (often free) |
| Processing time | Days to weeks | 4-8 weeks |
| Rate options | Current lender only | Whole market |
| Borrowing more | Often limited | More flexibility |
When Product Transfer Wins
| Scenario | Why |
|---|---|
| Circumstances changed | Lighter affordability checks |
| Need speed | Can complete in days |
| Competitive rate offered | Why switch if rate is good? |
| Low savings from switching | Not worth the hassle |
| Self-employed recently | May have difficulty with full affordability |
When Remortgaging Wins
| Scenario | Why |
|---|---|
| Much better rates elsewhere | Significant savings |
| Want to borrow more | Other lenders may be more flexible |
| Unhappy with lender | Service issues |
| Better LTV bracket | Unlock better deals |
| Product transfer rate poor | Don’t accept it — shop around |
Current Remortgage Rates (2025)
Fixed Rates by LTV
| LTV | 2-Year Fixed | 5-Year Fixed |
|---|---|---|
| 90% | 4.8-5.5% | 4.6-5.2% |
| 85% | 4.4-5.0% | 4.2-4.8% |
| 80% | 4.0-4.6% | 3.9-4.4% |
| 75% | 3.8-4.3% | 3.7-4.2% |
| 60% | 3.6-4.0% | 3.5-3.9% |
Rates change frequently — check current deals.
Comparing Deals: Rate vs Fees
| Deal | Rate | Fees | Total Cost (£200k, 2yr) |
|---|---|---|---|
| Deal A | 3.99% | £999 fee | £16,000 interest + £999 = £16,999 |
| Deal B | 4.19% | No fee | £16,800 interest = £16,800 |
| Deal C | 4.09% | £495 fee | £16,400 interest + £495 = £16,895 |
Best total cost: Deal C
Always calculate the total cost over the deal period, not just the headline rate.
The Remortgage Process
Timeline
| Timeframe | Action |
|---|---|
| 6 months before | Start researching deals |
| 4-5 months before | Get Decision in Principle |
| 3-4 months before | Apply for chosen deal |
| 2-3 months before | Valuation and legal work |
| 1 month before | Receive mortgage offer |
| 2 weeks before | Final checks |
| Deal end date | New mortgage completes |
Step-by-Step Process
1. Gather Information
| Document | Why Needed |
|---|---|
| Current mortgage statement | Outstanding balance, rate, end date |
| Property value estimate | For LTV calculation |
| Recent payslips (3 months) | Proof of income |
| Bank statements (3 months) | Affordability assessment |
| ID documents | KYC requirements |
| Proof of address | KYC requirements |
2. Compare Deals
Use comparison sites and/or a broker:
- MoneySupermarket
- Compare the Market
- uSwitch
- Moneyfacts
- Whole-of-market broker
3. Get Decision in Principle (DIP)
Soft or hard credit check confirms likely approval.
4. Apply
Submit full application with documents.
5. Valuation
Lender values your property (often free for remortgages).
6. Legal Work
Solicitor handles transfer (often free with remortgage deals).
7. Mortgage Offer
Written confirmation of new mortgage terms.
8. Completion
New mortgage pays off old one, switch complete.
Remortgage Costs
Typical Fees
| Fee | Range | Notes |
|---|---|---|
| Arrangement fee | £0-£2,000 | Can often add to loan |
| Booking fee | £0-£250 | Usually non-refundable |
| Valuation | £0-£500 | Often free for remortgages |
| Legal fees | £0-£500 | Often free via cashback |
| Early repayment charge | 1-5% of balance | On current mortgage |
| Exit/deeds fee | £50-£300 | Current lender charge |
Free Remortgage Deals
Many lenders offer packages with no valuation or legal fees:
| Feature | Standard | Free Remortgage |
|---|---|---|
| Valuation | £150-£500 | Free |
| Legal work | £300-£500 | Free or cashback |
| Arrangement fee | £0-£2,000 | May still apply |
| Total fees | £500-£3,000 | £0-£2,000 |
Early Repayment Charges
Typical ERC Structures
| Year | Typical ERC | 5-Year Fixed | 2-Year Fixed |
|---|---|---|---|
| Year 1 | 5% | Applies | Applies |
| Year 2 | 4% | Applies | Ends |
| Year 3 | 3% | Applies | N/A |
| Year 4 | 2% | Applies | N/A |
| Year 5 | 1% | Applies | N/A |
| After | 0% | Ends | N/A |
When to Pay an ERC
Calculate whether savings outweigh the charge:
Example: Breaking a 5-year fix in year 3
| Factor | Amount |
|---|---|
| Outstanding mortgage | £200,000 |
| ERC (3%) | £6,000 |
| Current rate | 5.5% |
| New rate | 4.0% |
| Monthly saving | £168 |
| Annual saving | £2,016 |
| Time to break even | 3 years |
| Remaining on deal | 2 years |
In this case, wait unless rates are expected to rise further.
Remortgage with Changed Circumstances
Self-Employed
| Challenge | Solution |
|---|---|
| Variable income | 2-3 years accounts may be needed |
| New business | May need 12-24 months trading |
| Contractor | Some lenders more flexible |
| Lower income shown | Product transfer may be easier |
Reduced Income
| Situation | Options |
|---|---|
| Lower salary | Product transfer (lighter checks) |
| Recent redundancy | Wait until new employment stable |
| Part-time | Some lenders count full income |
| Pension income | Specialist lenders for retirement |
Credit Issues Since Original Mortgage
| Issue | Impact |
|---|---|
| Missed payments | May limit options, higher rates |
| New CCJ | Specialist lenders only |
| High credit card use | Affects affordability |
| New loans | Reduces borrowing capacity |
Equity Release When Remortgaging
What You Can Borrow
| Property Value | Current Mortgage | Equity | Max Additional (75% LTV) |
|---|---|---|---|
| £300,000 | £150,000 | £150,000 | £75,000 |
| £350,000 | £200,000 | £150,000 | £62,500 |
| £400,000 | £200,000 | £200,000 | £100,000 |
| £500,000 | £250,000 | £250,000 | £125,000 |
Common Uses for Released Equity
| Purpose | Considerations |
|---|---|
| Home improvements | May add value |
| Debt consolidation | Risky — converts short to long-term |
| Help family (deposit) | Gift tax implications |
| Investment | Not recommended with secured debt |
| Large purchase | Consider alternatives first |
Remortgage Checklist
Before Applying
- Note current deal end date
- Check early repayment charges
- Get current mortgage balance
- Estimate property value
- Calculate LTV
- Check credit score
- Gather income evidence
Comparing Deals
- Check current lender’s product transfer options
- Compare whole market (broker or comparison site)
- Calculate total cost including fees
- Note any cashback or free legals
- Check ERC on potential new deal
- Verify features (overpayment, portability)
Application
- Get Decision in Principle
- Submit full application with documents
- Respond promptly to queries
- Arrange valuation access if needed
- Complete legal requirements
Completion
- Review mortgage offer carefully
- Confirm completion date
- Update direct debit
- Note new deal end date
Using a Mortgage Broker
Pros and Cons
| Pros | Cons |
|---|---|
| Access whole market | May charge fee (£0-£500) |
| Expert advice | Quality varies |
| Handle paperwork | Not always necessary |
| Know lender criteria | Some restricted panels |
| Save time | Must still provide documents |
When to Use a Broker
| Situation | Broker Useful? |
|---|---|
| Complex income (self-employed) | Yes |
| Credit issues | Yes |
| Time-poor | Yes |
| Straightforward case | Optional |
| Product transfer likely right | No — apply direct |
Summary
Successful remortgaging means:
- Start early — 3-6 months before your deal ends
- Compare thoroughly — product transfer vs new lender
- Calculate total cost — not just headline rate
- Consider fees — free valuation/legal deals add value
- Check ERC — if breaking current deal early
- Act on time — avoid falling onto expensive SVR
Don’t automatically accept your lender’s product transfer — check the whole market first. Even small rate differences save thousands over a mortgage term.