Call us on 07548634027

Open 6 days a week – until 7pm on weeknights

Call now on: 07548634027 


When shouldn't you remortgage?

Remortgaging isn’t always the right option. If your financial situation has worsened since you applied for your existing mortgage, or if your property has dropped in value, you may struggle to find cheaper remortgage rates. If your income has fallen or your credit score has dropped, remortgaging might be difficult.

This is because, just like when you first took out a mortgage, when you apply for a remortgage, a lender will assess your affordability. There are strict rules lenders must follow when deciding whether to let you borrow money.

Lenders are also reluctant to extend mortgage terms for older borrowers. But even if remortgaging to extend your term isn’t possible, you may still be able to find a remortgage deal that costs you less.

It’s also worth knowing that not all mortgages can be ported to another property. So if you plan to move in the near future, find out if your remortgage could move with you.

If you remortgage before your current deal ends and during the lender’s tie-in period, you will likely have to pay an early repayment charge. This is a percentage of the remaining mortgage debt which usually reduces over time, meaning you pay less the later you leave. As this can run to thousands of pounds, it makes sense to check your current provider’s terms so you’re clear about their charges and what you would pay to exit at this stage.

If you only have a small mortgage left to pay off, you may find that some lenders have a minimum loan amount, usually £25,000, that they will accept as a remortgage.

How to remortgage

Whether you switch to a new lender or stay with your existing one, it is likely you’ll need to have your recent financial information to hand when you apply. This will include:

  • payslips from the last three months as proof of income
  • tax returns from the last few years if you’re self-employed
  • bank statements from the last three years and your latest P60 tax form

If you’re applying for a joint remortgage, you will need to provide this information for both of you. You will also need to show proof of ID and address.

If you are staying with your existing lender and just switching deals, it is a more straightforward process than if you’re remortgaging with a new lender. This is provided you aren’t also making changes to your mortgage, such as borrowing more. A straightforward product transfer won’t usually involve as much admin.

Once the lender has all the information it needs and everything is in order, it will approve the remortgage and you can start making your new repayments.

What remortgage costs are there?

While the main cost of remortgaging depends on the interest rate your lender sets, it’s important to consider all the fees that may also be charged, as they can soon mount up.

Types of remortgage fees for the lender you are moving to include:

  • arrangement fees for getting the remortgage
  • legal fees for using a conveyancing solicitor
  • valuation fees for the property
  • admin or account fees for setting up the new mortgage

For the lender you are leaving:

  • an early repayment charge if you leave your old lender or deal before it’s due to end
  • exit fees, or closure fee, for transferring the loan to a new lender

Find out exactly what fees you’ll have to pay to your current and future lender before going ahead with a remortgage.

Get in touch today to find out more about remortgaging.

Follow us on Social Media

Join the conversation and keep up-to-date with our latest news.

Because we play by the book we want to tell you that…

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

There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.

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

Need more help?