Once your discount, tracker or fixed-rate mortgage ends, you’ll land on a standard rate which can cost much more each month. Use our remortgage calculator to find out how much this could cost you, if you don’t make the right switch.
Your home or property may be repossessed if you do not keep up repayments on a mortgage.
If you don't remortgage your payments could go up by£0 a year
Based on your monthly payments it looks like your deal may have already ended.
It could be time to remortgage and make some savings to put towards things you'll love!
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Not remortgaging could cost you the same as...
Why pay potentially loads more each month when you could instead take your family on holiday?
Why overpay each month on your mortgage, when you could spend it on getting a new car?
Why not put that money you could be overspending on your mortgage into making home improvements to make it an even better place to live?
Need mortgage advice?We’ve partnered with London & Country Mortgages Ltd. (L&C) to provide you with fee-free mortgage advice. Get in touch with one of their advisers here.
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Frequently asked questions
How do I use the remortgage calculator?
Our remortgage calculator is designed to be as simple as possible. Simply enter a few of your details and we’ll take care of all the hard work and boring sums. Here’s what we’ll need from you:
- The term left on your mortgage in years
- Your outstanding mortgage balance
- Your current monthly repayment amount
- Your current mortgage rate
And that’s it. With those few details, we can quickly work out how much more you could end up paying if you don’t remortgage before your current deal ends.
Who can remortgage?
It depends on your individual financial circumstances, but you may be able to remortgage if your current deal is coming to an end.
You can still remortgage if you’re in the middle of a fixed-term mortgage deal. However if you’re still quite far from the end of your fixed term, it may not be your best option, as your current deal will likely have an expensive early repayment charge tied to it, which may outweigh any potential savings you could make.
Remortgaging after retirement age (usually over 60), used to be difficult, as lenders are more hesitant to lend to people who are no longer working. However, retirement interest-only (RIO) mortgages are now more accessible. Your potential lender will still run a series of affordability checks, but as long as you can prove you’ll be able to meet your repayments, you could still find a new deal.
Even if you own your home outright, you may be able to remortgage.
If you feel your financial situation may make remortgaging complicated, talk to our partnered mortgage advisers from London & Country Mortgages Ltd. free of charge. They can help you find the right option for you.
How can I find the best interest rate when I remortgage?
You can spend hours and hours researching different remortgage options, going from one website to another or calling round all the banks. If you’d rather not waste your time with all that hassle, you can compare a wide range of remortgage options with us at Compare the Market. With just a few details entered, we’ll search the market in less than a minute** to find you mortgage quotes from lenders big and small. Once your results come back, we’ll order them from the cheapest to the most expensive, allowing you to see immediately how much you can save. From there, you can play around with our different filtering options, to find the deal that best suits you.
**On average it can take less than 1 minute to complete a mortgage quote through Compare the Market based on data in September 2020.
How long does remortgaging take?
It depends on how and why you’re remortgaging, but a simple switch of rate with your existing lender for the same balance can be done in less than a day. If you’re looking to borrow more or release equity, this can take longer, as the terms of your mortgage will change more significantly.
If you’re remortgaging with a different lender, this can also take longer, because you’ll need to go through the full application process as a new customer. This will involve affordability checks, valuations and other legal processes.
It’s important that you leave enough time before your existing deal ends, as leaving it too late could see you slip onto the more expensive standard variable rate for a few months. Most lenders will let you apply for a rate between three and six months before your current deal ends.
How is this figure calculated?
When you took out your mortgage, you probably got a discount, tracker or fixed-rate deal, which is better than the standard variable rate (SVR), for the first few years. At the end of this term, your rate will change to your lender’s SVR. With our tool, we’ve used your outstanding mortgage balance, the time left before your mortgage is completely paid off, and the discounted rate you got in those first few years, to calculate how much more it’ll cost you if you don’t remortgage before you change to a lender’s typical SVR of 3.59%.
Why should I consider remortgaging?
There are three main reasons why you may consider remortgaging your home.
1. Getting a better deal and saving money each month
If your existing mortgage deal is coming to an end, your lender will put you onto their standard variable rate. This is usually the worst place to be, as it tends to offer the highest rates. Before you end up on that higher rate, compare remortgage deals to find a better rate and save money each month for exactly the same home.
2. Make changes to how you repay your mortgage
By remortgaging to a new deal, you can make changes to how your mortgage works. You will be able to easily switch from interest-only to a repayment mortgage. However, you won’t be able to switch from repayment to interest-only, unless you can demonstrate that you have a credible repayment method to pay off the loan at the end of term. You could add the flexibility to overpay on your mortgage, whether that’s with any leftover money you don’t spend each month, or if you come into a sudden windfall. You can also reduce or extend your mortgage term, allowing you to either pay off your mortgage sooner, or extend it to lower your monthly repayments.
3. Release equity to access money
If you need access to a large sum quickly, remortgaging to release equity in your home is one way of doing so. A common reason for doing this is to fund an extension or other home improvements. By releasing equity, you’re essentially selling a portion of your home back to your provider, which will mean that your outstanding mortgage balance will increase, which will also see your monthly repayments become more expensive.
UK remortgages in numbers***
There were more than 38,500 remortgages a month between January and September 2020. The number of remortgages a month, according to the Bank of England, was:
- January 2020: 47,102
- February: 51,176
- March: 47,160
- April: 32,127
- May: 27,261
- June: 38,064
- July: 39,162
- August: 31,182
- September: 34,236
UK Finance – a body representing 250 firms in the banking and finance industry – found that:
- There were 16,820 new remortgages where people had taken on extra borrowing in December 2019. That was 5.9% up on the same month in 2018
- The average extra borrowing for these remortgages was £50,702
- There were also 16,490 new remortgages where no extra money was borrowed in December 2019. That was 0.5% down on December 2018.
- The average loan size was £184,912 – which was 2.79 times the income of borrowers
- The average age of someone taking out a remortgage was 42
***This is specifically customers who are remortgaging to a new lender. There are many more ‘switches’ with the same lender.
The pandemic has prompted people to remortgage
Spending more time at home during the coronavirus pandemic caused many people to think about home improvement projects in 2020, according to a mortgage advice expert.
London & Country Mortgages Ltd have said: “The pandemic has made many people focus on what they need from their property and that will have contributed to some seeing a need to move. Others may be considering home improvements to add extra space which may be all the more necessary as many continue to work from home. Remortgaging to fund those home improvements is likely to continue to be a common approach.”
They have also said that borrowers in 2020 are largely opting for the certainty of fixed term remortgage deals, despite historically low interest rates.
“Borrowers will be focused on keeping their mortgage costs down, especially as interest rates remain at an historic low. The Bank of England base rate is currently at 0.10% and there’s even been speculation that rates could turn negative. However, that hasn’t changed the fact that most borrowers continue to opt for a fixed rate not a variable deal. The rates on fixed deals are still very low, so there’s not a price incentive to go for a variable deal and many will carry a minimum rate, so would not necessarily follow the base rate down even if it did fall.”
Survey shows positive experience of remortgaging
A study for NatWest bank found that three quarters of homeowners feel remortgaging had a positive impact on their life overall.
It also found that:
- 43% of people say remortgaging had a positive impact on their mental health – with a further 23% saying it improved their wellbeing and reduced stress
- For 8% of people, remortgaging was necessary due to COVID-19 – and a further 8% remortgaged because of stress and anxiety caused by the pandemic
- Three in five people say they’d consider remortgaging again to fund home improvements.
Give yourself plenty of time to complete remortgage process
Experts say they’re experiencing delays in mortgage processing – making it more important than ever to begin in good time. To help ensure a smooth switch, get together all the paperwork required by the lender ahead of time.