Time to remortgage? Everything you need to know to get best deal

Are you watching the months tick down until it’s time to remortgage wondering how you’ll be affected by interest rate rises or whether you can raise money for home improvements?

You’re not alone. According to trade body UK Finance, around 1.8 million homeowners with fixed rates will be shopping around for a new mortgage deal in 2025.

It needn’t be daunting, however. In this guide, we walk you through the remortgage process and explain everything you need to know so that you can secure the best deal for your circumstances.

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What does remortgaging mean?

Remortgaging happens when you move your mortgage from one lender to another because your mortgage deal has expired and you need a new one.

Most borrowers will remortgage every two or five years which are the most common periods to fix your rate for. Each time you remortgage you may incur mortgage and legal fees which makes remortgaging every two years expensive.

We cover fixed rates in more detail in our "should you fix your mortgage" guide.

Can you remortgage with the same lender?

Yes, you can remortgage with the same lender. It’s called a product transfer or product switch.

You are simply selecting a new rate to switch to from your current lender’s range which can take as little as 15 minutes to complete.

Borrowers don’t have to undergo any new credit or income checks. But you won’t receive any mortgage advice which could be valuable.

Aaron Strutt, product and communications director at mortgage brokerage Trinity Financial, said: “The vast majority of homeowners do a product transfer and stick with their existing lender rather than switch to another bank or building society.”

The convenience of the product transfer market is so popular among borrowers that UK Finance estimates it will be worth a whopping £254 billion this year, dwarfing the standard remortgage market which is predicted to hit £76 billion in 2025.

“Borrowers choosing a product transfer, however, do not always have access to the most competitively priced deals, early repayment charge-free products and specialist mortgages like offset deals,” said Mr Strutt. “They can't extend the mortgage term or remove parties from the mortgage unless they go through a full application either.”

Reasons why people remortgage

The main reasons people remortgage are:

• Switching to a new mortgage rate when your current deal expires.
• Raising money for home improvements.
• Consolidate other debts such as credit cards and personal loans by increasing the size of their mortgage to pay them off.
• Removing or adding someone to the mortgage.

How remortgages work

Here’s the seven steps of a remortgage:

Step 1: Know your loan to value

Your loan to value indicates how much of the value of your home is mortgage debt and how much you own. The lower your loan to value, the cheaper the rate you’ll be offered.

Divide your mortgage balance by the value of your property, which you can find out by using free tools on Zoopla or Rightmove, to get your loan to value ratio. For example, if your mortgage balance is £224,000 and your property is worth £280,000 your loan to value is 80%.

Step 2: Shop around for your next mortgage deal

Compare the rates offered by different lenders in your loan to value range.

Rhys Young, senior partner, mortgages and protection at Affinity Financial, said: “Assess what options are currently available with your existing lender but don’t assume it has the cheapest rates.”

There are thousands of mortgage deals on the market, so it’s a good idea to get some help.

“Ask your mortgage broker to search the whole market for you to see if any other bank can beat your lender’s deal,” added Mr Young.

Step 3: Decide if you want to change the terms of your mortgage

“Remember, you may have the option to reduce or extend your mortgage term, borrow more money or pay off a lump sum during the remortgage process,” said Mr Young.

Ask your bank’s mortgage adviser or a mortgage broker to go through your options. You can’t do any of these things, however, if you’re just switching deals with your existing lender.

Step 4: Fill out the application form

Complete a new mortgage application form with all your details and supply evidence of income and identity. You’ll need to pass the lender’s credit and affordability checks.

Step 5: Property valuation

Not everyone needs a valuation when they remortgage.

Some lenders are happy to rely on a computer-generated valuation rather than sending a surveyor around to your home.

Step 6: Instruct a solicitor

Borrowers who are remortgaging to a new lender will need a solicitor.

Lenders will often offer to pay for your legal work if you use a solicitor of their choice. Be prepared for this to take longer than using your own solicitor.

Step 7: Pay off your old mortgage

Your new lender will transfer enough money to your old lender to pay off your mortgage balance. If you’ve decided to increase the size of your mortgage, any money left over is paid to you.

How long does it take to remortgage?

A typical remortgage can take four weeks to complete but be prepared for it to take longer if you’re using your lender’s offer of free legal work. In this case it can take upwards of six weeks.

Avoid slowing the process down by answering the conveyancer’s questions promptly and in full and providing the correct, in date documentation when asked.

How soon can you remortgage?

You can begin the remortgage process up to six months before your existing mortgage rate expires.

Most lenders will allow new borrowers to complete the remortgage application and legal work in advance and reserve their rate until they are able to switch deals without incurring a penalty.

That way borrowers can transfer seamlessly from one deal to another.

What happens if you don’t remortgage?

By not remortgaging before the end of mortgage deal you’ll end up on your lender’s Standard Variable Rate which could be more than three times the cost of your previous rate.

For example, a borrower with around 40% equity in their home who fixed their rate for five years in 2020 would likely have been offered an interest rate of around 2%. When that rate expires in 2025, unless they have arranged a remortgage, their rate reverts to their lender’s SVR which, according to Moneyfacts in February 2025, is on average 7.78%. By remortgaging, however, they could lock into a rate of around 4 to 4.5%.

What happens if you remortgage early?

By remortgaging before your current mortgage deal expires, you’re likely to incur an early repayment charge from your lender. Tracker mortgages are typically the exception to this rule. They tend to be penalty free.

Different lenders use different fee structures, says Mr Strutt.

Take the 3.99% five-year fix which was recently offered by Barclays. “There is a 4% early repayment change until 30 June 2030. On a £300,000 mortgage, that would be £12,000 penalty in year five. I am pretty sure people could thing of better ways to spend this money rather than handing it to a bank," he said.

By contrast, Santander has previously offered a 3.99% five-year fixed rate with an early repayment charge that declines over the course of the five years. It meant in the final year, it has reduced to 1%, or £3,000 on a £300,000 mortgage.

Does a remortgage affect your credit score?

That depends on whether the lender carries out a soft or hard credit check. A soft credit check will not leave behind any trace, often referred to as a footprint, on your credit report. A hard credit check will be visible on your credit history.

If you’re shopping around for a mortgage, check which type of search the lender will carry out.

Having multiple searches show up on your credit report, particularly if you are declined, can damage your credit score as it signals you could be in financial distress.

What to consider when remortgaging

Here’s four things to consider when remortgaging:

1. What rate your existing lender is offering compared to other banks and building societies.
2. If you need any mortgage advice around raising money or changing the terms of your mortgage. You will not receive advice if you’re switching deals with the same lender.
3. Should you take a two, three or five-year fixed rate, or even longer, if you are looking for stability in your budget. Remember, leaving your mortgage deal early is costly.
4. Has your income or credit circumstances changed since taking out the mortgage? Borrowers who rate switch with their current lender do not undergo new income and credit checks.