Remortgaging: Is Now the Right Time to Review Your Deal?

If you have been on the same mortgage for a while, there is every chance you could be paying more than you need to. Remortgaging is one of the most effective ways homeowners can take control of their finances, yet many people stay on their existing deal long after it stops being the right option for them.

At Home Financial, we help clients across Warrington review their mortgage regularly so that it continues to work as hard as possible for their circumstances. Here is what you need to know.

What Does Remortgaging Actually Mean?

Remortgaging simply means switching your existing mortgage to a new deal, either with your current lender or with a different one. It does not mean moving home. You keep the same property; you just change the mortgage attached to it.

People remortgage for a range of reasons. The most common is to secure a more competitive interest rate, particularly when a fixed rate deal comes to an end. Others remortgage to release equity for home improvements, debt consolidation, or other financial goals. Whatever the reason, it pays to have expert advice on your side before you commit to anything.

What Happens When Your Fixed Rate Ends?

When your fixed rate period comes to an end, your lender will typically move you onto their Standard Variable Rate, known as an SVR. This rate is set by the lender and can change at any time, and it is almost always higher than the rates available to new customers. Sitting on an SVR without reviewing your options can cost you considerably more each month than necessary.

The good news is that you do not have to wait until your current deal ends to start looking. Most lenders allow you to secure a new rate up to six months before your existing deal finishes, meaning you can lock in a rate now and switch seamlessly when the time comes.

How Much Could You Save?

The potential saving from remortgaging depends on the difference between your current rate and the deals available to you, as well as your outstanding mortgage balance and remaining term. Even a modest reduction in your interest rate can translate into a meaningful saving over the course of a year, and even more so over a longer period.

It is also worth considering your loan to value ratio. If your property has increased in value since you took out your original mortgage, you may now sit in a lower loan to value band, which can unlock more competitive rates than were available to you previously.

Are There Any Costs to Consider?

Remortgaging is not entirely without cost, and it is important to weigh these up against the potential savings. Your existing lender may charge an early repayment charge if you switch before your current deal ends. There may also be arrangement fees on a new product, and legal and valuation costs to factor in, though many lenders offer free legals and valuations as part of a remortgage package.

A good broker will help you calculate the true cost of switching so that you can make a fully informed decision rather than simply chasing a headline rate.

Could You Release Equity at the Same Time?

If you have built up equity in your home over the years, remortgaging can also be an opportunity to release some of that value. Many homeowners use this to fund home improvements, cover significant expenses, or consolidate existing debts. It is worth exploring whether this makes sense for your situation as part of any remortgage review.

Our team can walk you through all the options available and help you decide on the right course of action. Find out more about our mortgage services or contact us to arrange a no-obligation conversation.

FAQs

How long does the remortgaging process take?

The process typically takes between four and eight weeks from application to completion, though this can vary depending on the lender, the complexity of your application, and how quickly the legal work is completed. Starting the process early gives you the best chance of everything being in place before your current deal ends.

Can I remortgage if I am self-employed?

Yes. The same principles apply as with any mortgage application, though lenders will want to see evidence of your income through accounts or tax returns. Working with a specialist broker who understands self-employed applications is particularly important here, as they will know which lenders take the most favourable view of your circumstances. You can find out more about our approach to specialist mortgages on our website.

What if my financial circumstances have changed since I took out my original mortgage?

Changes to your income, employment status, or credit history can all affect your remortgage options. In some cases, your existing lender may offer a product transfer, which involves switching to a new deal without a full affordability assessment. A broker can help you understand whether this or a full remortgage to a new lender is the better route given your current situation.

Your home may be repossessed if you do not keep up repayments on your mortgage.

You may have to pay an early repayment charge to your existing lender if you remortgage.