Your Complete Guide to Remortgaging (UK)
Thinking about switching your mortgage? Whether you're looking to save money, release equity, or find a deal that better suits your needs, remortgaging could be a smart move. Here's everything you need to know.
What is Remortgaging?
Remortgaging means moving your existing mortgage to a new deal – either with your current lender or a different one. You're not moving house; you're simply changing the mortgage on your current home.
Why Remortgage?
People remortgage for many reasons, including:
- Getting a better rate: Avoid high standard variable rates (SVRs) when your deal ends.
- Releasing equity: Borrow more against your home’s increased value.
- Consolidating debt: Roll debts into one (note: seek advice first).
- Changing your mortgage type: Switch from interest-only to repayment or adjust your mortgage term.
When Should I Remortgage?
It’s best to start shopping around 3–6 months before your current deal ends.
You may want to wait if:
- You're locked into a deal with high early repayment charges.
- Your property's value has dropped.
- Your credit score has recently been affected.
How Much Can I Borrow?
This depends on:
- Your home’s value
- Your equity
- Your income and spending
- Your credit history
A lower loan-to-value (LTV) generally means access to better interest rates.
How Does the Remortgaging Process Work?
Here’s a step-by-step breakdown:
- Review your current mortgage – including any early repayment charges.
- Check your credit score – and fix any issues.
- Compare deals – don’t just look at the interest rate; consider fees too.
- Speak to a mortgage adviser – they can help you find the best options.
- Apply for the new mortgage – your chosen lender will assess your application.
- Property valuation and legal checks – often covered by the lender.
- Complete the switch – your new lender repays your old mortgage and your new deal begins.
What Will It Cost?
Be aware of potential costs such as:
- Early repayment charges
- Exit fees
- Arrangement or booking fees
- Valuation and legal fees (some deals include these for free)
Want to Release Equity?
If your property has increased in value, you may be able to borrow more – this is called equity release. It can be used for:
- Home improvements
- A second property
- Large purchases or events
- Debt consolidation
What About Product Transfers?
If you're happy with your current lender, ask about a product transfer. It’s often quicker than a full remortgage – but it’s still worth comparing deals elsewhere to make sure you’re getting the best rate.
Common Remortgaging Mistakes
Avoid these common pitfalls:
- Leaving it too late – don’t default to your lender’s SVR.
- Overlooking fees – a lower rate isn’t always cheaper.
- Borrowing more than necessary – always budget carefully.
- Ignoring your credit score – it matters more than you think.
Final Thoughts
Remortgaging can offer great benefits – lower monthly payments, access to equity, or simply a more suitable deal. But it’s important to make an informed decision based on your personal circumstances.
Need expert advice? Contact us today - we’ll help you explore your options and find the best remortgage deal for you.
