Remortgaging Guide

This guide explains what remortgaging is, when it makes sense to switch deals, how the process works, and what costs to expect. It is designed to help homeowners decide whether remortgaging could save money or improve financial flexibility.

What Is Remortgaging?

Remortgaging means switching your existing mortgage to a new lender or a new deal with your current lender. The main reason people remortgage is to reduce monthly payments by moving to a lower interest rate. Other reasons include releasing equity, consolidating debt, or fixing payments for longer.

When Should You Consider Remortgaging?

• When you are approaching the end of a fixed-rate deal.
• If your lender’s standard variable rate is higher than new deals available.
• When your property value has increased, giving you access to lower loan-to-value bands.
• If you want to borrow more for home improvements.
• When you want more stability by fixing your rate for 2, 5, or 10 years.
• If your financial situation has improved and you now qualify for better rates.

When Remortgaging May Not Be Suitable

• If paying early repayment charges outweighs potential savings.
• If your credit score has deteriorated since taking out your current mortgage.
• If your income is lower or financial circumstances have become more complex.
• If your remaining mortgage balance is small.
• If you are planning to move home soon.

How the Remortgaging Process Works

1. Check your current mortgage details, including rate, term, and any early repayment charges.
2. Compare new deals or speak to a mortgage broker for personalised options.
3. Obtain a mortgage in principle to understand what you qualify for.
4. Apply for the new mortgage, providing income and identity documents.
5. A valuation will be carried out on your property.
6. Legal work is completed, usually provided for free by many remortgage lenders.
7. Your old mortgage is paid off and your new deal begins.

Remortgaging typically takes between 4 and 8 weeks.

Types of Remortgage Deals

• Fixed-rate mortgages for payment certainty.
• Tracker mortgages that follow the Bank of England Base Rate.
• Discounted standard variable rate deals.
• Offset mortgages linking savings to reduce interest.

Costs To Consider When Remortgaging

• Early repayment charges if you leave your current deal early.
• Exit fees charged by your existing lender.
• Arrangement fees for new mortgage products.
• Valuation fees, depending on the lender.
• Legal fees, although many lenders offer free legal support for remortgages.

Make sure to compare the overall cost of a deal, not just the interest rate.

Tips for a Smooth Remortgage

• Start the process 3 to 6 months before your fixed-rate ends.
• Check your credit report and correct any errors.
• Avoid taking on new debt before applying.
• Keep payslips, bank statements, and tax documents up to date.
• Consider locking in a rate early if interest rates are rising.

Alternatives to Remortgaging

• Product transfer with your current lender.
• Additional borrowing through your existing mortgage.
• Secured loans, depending on circumstances.
• Staying on your lender’s standard variable rate if it is competitive.

This guide forms part of the wider homebuying and homeowner series, including the Mortgage Types Explained, Fees and Costs When Buying a Home, and Home Insurance and Protection Guide pages.