Should You Remortgage? A Full Guide for UK Homeowners

With mortgage rates constantly shifting and financial goals evolving, many UK homeowners find themselves wondering: Should I remortgage? The answer depends on a number of factors including your current mortgage deal, financial situation, and future plans.

In this complete guide, we break down when remortgaging is a smart move, when it might not make sense, and how to make the best decision based on your personal circumstances.

What Does It Mean to Remortgage?

Remortgaging means switching your current mortgage deal to a new one—either with your existing lender or a different provider. You’re not moving house; you’re simply replacing the mortgage on your current home.

This can help you:

• Secure a lower interest rate

• Reduce your monthly payments

• Release equity from your home

• Switch to a mortgage with better flexibility

• Avoid being moved to your lender’s Standard Variable Rate (SVR)

When Is Remortgaging a Smart Decision?

Here are the most common—and beneficial—reasons to consider a remortgage:

1. Your Fixed-Rate Deal Is Ending Soon

Most fixed-rate mortgage deals in the UK last 2, 3, or 5 years. Once the deal ends, you’re typically moved onto the lender’s SVR, which is usually much higher.

Example:
You’re with NatWest on a 2-year fix at 3.29%. When it ends, the SVR could jump to 7.74%, significantly increasing your repayments. Remortgaging before that happens could save you hundreds each month.

2. You’ve Gained Equity in Your Home

If your property value has increased or you’ve paid down a significant chunk of your mortgage, your loan-to-value (LTV) ratio improves. This means you might qualify for lower interest rates.

Example:
If you originally borrowed 85% LTV and now sit at 70%, lenders like Halifax or Santander may offer better rates as you’re now lower risk.

3. You Want to Borrow More

Remortgaging allows you to raise additional funds for major expenses like:

• Home renovations

• Debt consolidation

• Funding a child’s education

Many lenders—including Nationwide and TSB—offer additional borrowing options during a remortgage.

When Should You Avoid Remortgaging?

While remortgaging can offer savings, there are situations where it may not be worth it:

1. High Early Repayment Charges (ERCs)

Most fixed-rate and tracker mortgages have ERCs if you leave early. These fees can range from 1% to 5% of the outstanding balance.

Example:
You have £200,000 remaining and an ERC of 3% — that’s £6,000 just to exit the deal. Unless your savings from a new deal exceed this, it’s not worth switching.

2. Your Credit Score Has Dropped

If your credit score has worsened since you took out your mortgage, you may no longer qualify for competitive rates. In that case, staying put until you improve your score might be the better option.

3. You’re Planning to Move Soon

If you’re likely to sell your home within the next year or two, remortgaging may not be cost-effective—especially if there are arrangement fees or ERCs involved.

What Costs Are Involved in Remortgaging?

While some lenders offer fee-free remortgage deals, others charge various costs. Here’s a breakdown:

Tip: Many lenders like HSBC and Barclays offer free legal and valuation services on selected remortgage products.

How Much Could You Save by Remortgaging?

Let’s consider a realistic example:

Over two years, this homeowner could save nearly £6,000 simply by switching. Always factor in fees to get the true cost-benefit.

How Long Does the Remortgaging Process Take?

Typically, remortgaging in the UK takes between 4 to 8 weeks, depending on the lender and complexity. You can speed it up by:

• Having documents ready (proof of income, ID, mortgage statement)

• Responding quickly to solicitors and brokers

• Using a lender offering “fast-track” or simplified remortgage products

Which UK Banks Offer Competitive Remortgage Deals?

Many banks and building societies offer tailored remortgage products. Here’s a snapshot:

What Documents Do You Need to Remortgage?

To apply for a remortgage, you typically need:

• Proof of income (e.g. payslips or SA302s for self-employed)

• Latest mortgage statement

• Proof of ID and address

• Bank statements (last 3–6 months)

• Details of the property value (lender may arrange a valuation)

Your broker or lender will advise if anything else is needed based on your situation.

Can You Remortgage If You’re Self-Employed?

Yes, but the process may be more rigorous. Lenders usually ask for:

• 2 years of accounts or SA302s

• Business bank statements

• Evidence of consistent income

Some lenders specialise in self-employed mortgages, and brokers can help match you with one that suits your profile.

How to Decide: Is Remortgaging the Right Move for You?

Ask yourself the following questions:

1. Is your current deal ending soon?

2. Are you on an SVR or higher-than-average rate?

3. Could you benefit from better LTV bands due to increased equity?

4. Do you want to borrow more or pay off debts?

5. Are the savings worth any potential fees?

If most of your answers lean “yes,” remortgaging may be a financially sound decision.

Final Word: Review Regularly and Act Strategically

Remortgaging isn’t something to fear—it’s a routine part of smart financial planning for many UK homeowners. But timing and research are everything.

Start reviewing your options 3–6 months before your current deal ends. Compare deals, check fees, and speak to a qualified mortgage broker if you’re unsure. A few hours of planning could save you thousands over the next few years.