When to switch your mortgage, how the process works, and when it might not be worth it
Remortgaging means switching your existing mortgage to a new deal — either with your current lender (a product transfer) or with a different lender. It is one of the most effective ways to reduce your monthly payments, release equity from your home, or restructure your borrowing.
Around 40% of all mortgage activity in the UK is remortgaging, and most homeowners will remortgage several times over the life of their loan. If you are approaching the end of a fixed or introductory rate, or you are sitting on your lender's Standard Variable Rate, there is a strong chance you could save money by switching.
The most common reason. When your fixed or tracker deal ends, you revert to the lender's SVR, which is typically 2–3% higher than the best available rates. Switching to a new deal can save hundreds of pounds per month.
If your property has increased in value, you can remortgage for a larger amount and take the difference as cash. This is commonly used to fund home improvements, and the interest rate is typically much lower than a personal loan.
Adding an extension, converting a loft, or renovating a kitchen can add significant value to your property. Remortgaging to fund the work often makes financial sense, especially when the improvement adds more value than it costs.
Rolling expensive debts (credit cards at 20%+, personal loans at 8%+) into your mortgage at 4–5% reduces monthly outgoings. However, because you are spreading the debt over a much longer term, you may pay more in total interest.
You might want to switch from interest-only to repayment, extend or shorten your term, or move from a variable to a fixed rate (or vice versa).
After a separation or divorce, remortgaging can transfer the mortgage into one person's sole name, assuming they pass affordability checks alone.
Find out when your current rate ends, what your early repayment charge (ERC) is, and what SVR you will revert to. Your annual mortgage statement has this information, or call your lender. Set a calendar reminder for 3–4 months before your deal expires.
Most mortgage offers are valid for 3 to 6 months. By starting your search early, you can secure a new deal that begins the day your current one ends, avoiding even a single month on the SVR. Your current lender will also contact you with product transfer options — compare these against the wider market.
Use a mortgage broker to search across all lenders, or compare products yourself on comparison sites. Consider the total cost over the deal period (monthly payments plus fees), not just the interest rate headline. A slightly higher rate with no arrangement fee can be cheaper overall than a rock-bottom rate with a £1,500 fee.
The application process is similar to your original mortgage: income verification, credit checks, property valuation, and underwriting. If you are staying with the same lender (product transfer), the process is usually simpler — often no valuation or legal work is needed.
When you remortgage to a different lender, a solicitor or conveyancer handles the legal transfer. Many lenders offer a free legal service as part of the remortgage package. The legal work is simpler than a purchase — there is no buyer/seller negotiation, just a transfer of the charge on the property.
Your new mortgage replaces the old one. The new lender pays off your existing mortgage and registers their charge against the property. You start making payments to the new lender under the new terms.
Remortgaging is not free, but the savings usually outweigh the costs significantly. Here are the typical expenses:
Remortgaging is not always the right move. Here are situations where it may not make sense: