Why should I remortgage?
People tend to remortgage when their current mortgage is coming to an end. To avoid automatically moving on to a standard variable rate (SVR) mortgage, which could be more expensive, clients look around for a better deal. People also remortgage to lock in better interest rates, borrow extra money to improve their homes, take out some equity or switch between variable and fixed rates based on market conditions. Any big change in your finances or mortgage needs might make you think about remortgaging.
How much could I save by remortgaging?
The amount you could save by remortgaging depends on your current mortgage, the interest rates available to you and your individual circumstances. An online remortgage calculator is a good place to start, as it can give you an estimate based on details such as your outstanding mortgage balance, property value and current interest rate.
For a more accurate idea of your potential savings, it's worth speaking to a mortgage adviser. They can compare deals across the market, take any fees or early repayment charges into account and help you work out whether remortgaging is the right option for you.
When should I start the process?
It's best not to leave it until the last minute. We recommend starting the remortgaging process around six to seven months before your current mortgage deal ends. This allows you to secure a new rate early on and gives the team plenty of time to explore your options, compare mortgage products and complete your application. Mortgage offers are usually valid for six months and, should rates drop between the offer and completion, you can easily switch to the lower rate without penalty.
Starting early can also help you secure a new deal before moving onto your lender's SVR, which is often higher than fixed or tracker mortgage rates.
Can I remortgage before my deal ends?
Yes, it's possible to remortgage before your current mortgage deal ends. However, if you leave your existing deal early, your lender may charge an early repayment charge (ERC), as well as other fees.
In some cases, the savings from switching to a lower interest rate can outweigh these costs, but every situation is different. It's worth checking the terms of your current mortgage and comparing the overall costs before making a decision. A mortgage adviser can help you work out whether remortgaging early is the right option for you.