When to Remortgage
Remortgaging — switching your mortgage to a new deal, either with your current lender or a different one — is one of the most powerful financial moves a homeowner can make. For millions of UK homeowners, remortgaging at the right time can save hundreds of pounds every month.
End of Fixed Rate Deal
When your fixed or tracker deal ends, you automatically roll onto your lender's Standard Variable Rate, which is almost always much higher. Start shopping 6 months early.
Better Deals Available
If rates have dropped significantly since you took out your mortgage, switching could save you thousands even if you pay an ERC — do the maths carefully.
Equity Release
Increased property values or capital repayments mean you may have significant equity. Remortgaging can release this as cash for home improvements, investing or other needs.
Home Improvements
Rather than taking an expensive personal loan, borrowing additional funds via remortgage at mortgage rates for an extension or renovation is often far cheaper.
The Standard Variable Rate Trap
When your mortgage deal expires — whether it is a 2-year or 5-year fixed rate — your lender moves you automatically onto their Standard Variable Rate (SVR). In 2026, SVRs from major UK lenders typically sit between 7% and 9%, compared to the best fixed deals available at 4–5%. On a £200,000 mortgage, this difference could cost you £300–£500 per month.
When You Have Built Equity
As you repay your mortgage and as property values increase, your Loan-to-Value (LTV) ratio falls. Crossing key LTV thresholds — 90%, 85%, 80%, 75%, 70%, 65%, 60% — unlocks progressively better rates. Checking whether you have crossed into a new tier is an excellent reason to review your mortgage deal, even mid-term.
How Remortgaging Works Step by Step
The remortgaging process is more straightforward than buying a home for the first time. There is no property search, no chain to worry about, and the process can often be completed within 4–8 weeks from application. Here is exactly what to expect:
- Review your current deal: Find your mortgage account details, note your outstanding balance, current interest rate, remaining deal term, and whether any Early Repayment Charge (ERC) applies if you leave early.
- Check your property value: Use recent comparable sales data or a professional valuation to estimate your current property value. This determines your LTV and the deals available to you.
- Compare deals on the market: Use comparison sites, speak to a mortgage broker, and check deals directly with lenders. Compare like-for-like: initial rate, arrangement fees, true cost over the deal period.
- Apply for a Decision in Principle (DIP): Also called an Agreement in Principle, this is a preliminary assessment from a lender confirming they are likely to lend to you. It does not affect your credit score if a soft search is used.
- Submit your full mortgage application: Provide payslips, bank statements, P60, ID and proof of address. Self-employed borrowers will need 2–3 years of accounts.
- Valuation and legal work: The new lender will value your property (sometimes free, sometimes charged). A solicitor handles the transfer of the mortgage — many lenders include free conveyancing.
- Completion: Your new mortgage begins. The new lender pays off the old one, and your new monthly payment commences on the agreed date.
Remortgage Costs Explained
Unlike buying a home, remortgaging typically involves fewer costs — but they can still add up. Understanding exactly what you will pay helps you make a true cost comparison between deals.
| Cost | Typical Amount | Notes |
|---|---|---|
| Arrangement / Product Fee | £0 – £2,000 | Can often be added to the loan, though this costs more over time |
| Booking / Application Fee | £0 – £300 | Usually non-refundable, paid upfront |
| Valuation Fee | £0 – £500 | Many lenders offer free valuations on remortgage |
| Legal / Conveyancing Fee | £300 – £1,000 | Many lenders offer free legal work or a cashback to cover this |
| Early Repayment Charge (ERC) | 1% – 5% of balance | Only if leaving your current deal before the end date |
| Broker Fee | £0 – £500 | Many whole-of-market brokers are free (paid by lender) |
| Deeds Release Fee | £0 – £300 | Charged by your existing lender to release title deeds |
Early Repayment Charges (ERCs) in Detail
If you are mid-deal — for example, 18 months into a 5-year fix — you will almost certainly face an ERC for leaving early. ERCs are typically calculated as a percentage of your outstanding balance. A 3% ERC on a £180,000 mortgage is £5,400 — a significant sum that must be weighed against any savings from switching.
ERCs generally reduce over the term of the deal. A 5-year fix might carry a 5% ERC in year one, 4% in year two, 3% in year three, 2% in year four, and 1% in year five. Always check the exact schedule in your mortgage offer.
True Cost Calculation
Never compare mortgages on initial rate alone. The true cost over the deal period includes the interest paid, all fees and any cashback received. A 4.2% mortgage with no fees may be cheaper overall than a 3.9% mortgage with a £2,000 arrangement fee on a small loan amount. Use our Mortgage Calculator to model the total cost of different scenarios.
Loan-to-Value (LTV) and How It Affects Rates
Your Loan-to-Value ratio is the outstanding mortgage amount expressed as a percentage of your property's current value. It is the single most important factor in determining what remortgage rates you qualify for.
| LTV Band | Rate Tier | Example 5-Year Fix (2026) |
|---|---|---|
| Up to 60% | Best available | ~4.1% |
| 60% – 70% | Very competitive | ~4.3% |
| 70% – 75% | Competitive | ~4.5% |
| 75% – 80% | Standard | ~4.7% |
| 80% – 85% | Higher rate | ~4.9% |
| 85% – 90% | Restricted choice | ~5.3% |
| Above 90% | Limited options | ~5.8%+ |
If your property has increased in value since you purchased it, your LTV may have fallen substantially. Use our Mortgage Calculator to model what rate tier you now fall into and how much you could save by remortgaging.
Calculating Your Current LTV
The formula is simple: LTV = (Outstanding Mortgage Balance / Current Property Value) × 100. If you owe £150,000 on a home now worth £250,000, your LTV is 60% — qualifying you for the very best rates on the market.
Product Transfer vs Full Remortgage
When your deal ends, you have two options: a product transfer with your existing lender, or a full remortgage to a new lender. Both have advantages and the right choice depends on your circumstances.
| Factor | Product Transfer | Full Remortgage |
|---|---|---|
| Speed | Very fast (days) | 4–8 weeks |
| Legal fees | None | Usually free or cashback |
| New affordability check | Usually not required | Full affordability assessment |
| Rate competition | Only lender's own deals | Whole of market access |
| Best for | Those who may not pass new checks | Most borrowers seeking best rates |
| Equity release | Possible but limited | Full flexibility |
A product transfer is the right choice if your income has dropped, if you are self-employed with recent poor accounts, or if your credit score has deteriorated. The speed and simplicity also suits those whose deal is expiring imminently. For most borrowers with stable finances, a full remortgage to the best deal on the market will deliver greater savings.
Offset Mortgages
An offset mortgage links your mortgage to one or more savings accounts held with the same lender. Rather than earning interest on your savings, the savings balance is offset against your mortgage balance, so you only pay interest on the difference. For example, if you have a £200,000 mortgage and £40,000 in savings, you only pay interest on £160,000.
Benefits of Offset Mortgages
- Interest savings can significantly reduce your mortgage term or monthly payments
- Your savings remain accessible — you can withdraw them at any time
- Particularly effective for higher and additional-rate taxpayers who would otherwise pay tax on savings interest
- Ideal for those with variable income (e.g., freelancers) who want a buffer while still reducing mortgage costs
Offset Mortgage Drawbacks
- Offset rates are typically higher than the best standard deals
- They only make sense if you maintain a meaningful savings balance
- Fewer lenders offer offset mortgages, so choice is more limited
UK Mortgage Rates Overview 2026
UK mortgage rates have stabilised in 2026 following the Bank of England's rate-cutting cycle that began in 2024. The base rate currently sits at around 4.25%, and lenders are pricing their products competitively as the housing market remains active.
| Mortgage Type | Deal Length | Indicative Rate (60% LTV) |
|---|---|---|
| Fixed Rate | 2-year fix | ~4.2% – 4.6% |
| Fixed Rate | 3-year fix | ~4.1% – 4.5% |
| Fixed Rate | 5-year fix | ~4.0% – 4.4% |
| Fixed Rate | 10-year fix | ~4.3% – 4.8% |
| Tracker (2-year) | 2-year tracker | Base + 0.1% – 0.5% |
| Standard Variable Rate | No fixed term | 7.0% – 9.0% |
Should You Fix or Track in 2026?
With the Bank of England base rate expected to remain broadly stable in 2026, many borrowers are opting for 5-year fixed deals to lock in current rates and gain payment certainty. Tracker mortgages can offer short-term savings if rates fall further, but carry the risk of payments rising if conditions change. Use our Mortgage Overpayment Calculator to model how overpayments can reduce your mortgage term regardless of which deal you choose.
How to Compare Remortgage Deals
Finding the best remortgage deal requires looking beyond the headline rate. Here is a systematic approach to comparing deals properly:
- Calculate the true cost: Add total interest + arrangement fee − any cashback over the deal period.
- Check the revert rate: What SVR will you fall onto when the deal ends? A lender with a low introductory rate but very high SVR may cost more if you forget to remortgage again.
- Consider portability: If you might move home during the deal, can you take the mortgage with you? Most fixed rates are portable, but not all.
- Check overpayment allowances: Most deals allow 10% overpayments per year penalty-free. If you plan to overpay more, you need a flexible deal.
- Use a whole-of-market broker: Brokers with access to the full market (not tied to one lender) can access exclusive deals not available directly and handle the paperwork for you.
Using a Mortgage Broker
A whole-of-market mortgage broker can search thousands of deals and may access exclusive rates not available on the high street. Many brokers charge no fees to the borrower (they are paid by the lender). For complex situations — self-employed, poor credit, unusual properties — a specialist broker is particularly valuable. Always check the broker is authorised by the Financial Conduct Authority (FCA) before proceeding.
Frequently Asked Questions
When is the best time to remortgage in the UK?
The best time to start the remortgaging process is 3–6 months before your current fixed rate deal ends. This gives you enough time to compare deals, submit an application and complete the legal work — ensuring your new deal starts exactly when your old one expires, so you avoid falling onto the SVR even for a single month. Most mortgage offers are valid for 6 months, so there is no disadvantage to starting early.
How much does remortgaging cost in the UK?
Remortgaging costs typically include an arrangement fee (£0–£2,000), valuation fee (often free on remortgage), legal/conveyancing fees (£300–£1,000, often covered by the lender), and potentially an Early Repayment Charge (ERC) of 1–5% of the outstanding balance if you leave your current deal early. Some lenders offer cashback deals that offset many of these costs. Always calculate the net true cost of switching before proceeding.
What is a product transfer and how does it differ from remortgaging?
A product transfer means switching to a new deal with your existing lender without moving to a new lender. It is faster (can be done in days), does not require legal work, and sometimes does not require a new affordability assessment. A full remortgage means moving to a new lender entirely — it gives access to the whole market but takes longer and involves more paperwork. For most borrowers with stable finances, shopping the full market yields better rates than a product transfer alone.
Can I remortgage to release equity from my home?
Yes. Equity release remortgaging lets you borrow more than your outstanding mortgage balance, receiving the difference as a lump sum of cash. This is commonly used for home improvements, consolidating expensive debt, helping children with deposits, or funding other major expenses. Your new, larger mortgage balance will increase your LTV, which may affect the rates available to you. Always ensure the monthly payments on the increased balance are comfortably affordable.
What is an Early Repayment Charge (ERC) and how is it calculated?
An ERC is a penalty charged by lenders when you pay off or switch away from a mortgage during a fixed or introductory deal period. ERCs typically range from 1% to 5% of the outstanding mortgage balance and are structured to decrease over the deal term. For example, a 5-year fix might carry a 5% ERC in year one, reducing by 1% each year until it reaches 1% in the final year. On a £200,000 balance, a 3% ERC is £6,000 — a significant cost that must be weighed against potential savings from switching.
How does Loan-to-Value (LTV) affect remortgage rates?
LTV is the outstanding mortgage expressed as a percentage of your property's value. The lower your LTV, the better the rates available. Lenders offer their best rates at 60% LTV or below, with rates typically stepping up at 65%, 70%, 75%, 80%, 85% and 90% LTV thresholds. As your property's value rises and you repay capital, your LTV falls — so it is worth checking which tier you fall into at each remortgage, as you may have crossed into a better rate band since your last deal.
Can I remortgage if I am self-employed?
Yes, self-employed people can remortgage, though lenders typically require 2–3 years of certified accounts or tax returns to assess income. Some lenders use your salary plus dividends (for company directors), while others use net profit. Using a specialist mortgage broker who understands self-employed cases is strongly recommended, as they will know which lenders are most receptive to your specific income structure and can help you present your application in the most favourable way.