How to remortgage your home: step-by-step UK guide
Remortgaging means switching your existing mortgage to a new deal. Most people do this when their current deal is about to end to avoid their lender’s standard variable rate (SVR) - potentially saving hundreds of pounds a month. The process usually takes up to 8 weeks and can cost between £0 and £2,000+, depending on fees. Here’s how to remortgage step-by-step, how to time it and whether it’s worth it.
To remortgage a house, you switch your current mortgage to a new deal by comparing remortgage rates, applying to a lender, and completing checks – usually taking 4-8 weeks, or around a week if you stay with the same lender. Most people remortgage 3-6 months before their deal ends to secure a better rate or release equity.
This is the step-by-step process of how to remortgage.
1. Check your current mortgage deal
Dig out your paperwork and remind yourself of the details of your current mortgage. Double check the type of mortgage you are on, confirm your current interest rate and check for early repayment charges.
If your current mortgage deal ends in the next 6 months, you can start the remortgage process now so you’re ready to switch to your next deal when your current one ends.
2. Calculate your loan to value (LTV)
Your loan to value ratio (LTV) is the size of your mortgage compared to the value of your home and this determines which deals you may be able to get. The lower your LTV, the better the mortgage rates you’ll usually have access to.
Your LTV will have improved since you last took out a mortgage if your home’s value has increased and you have a repayment mortgage. So estimate your home’s current value – our online house valuation tool may help.
The most common reason for remortgaging is to switch to a new deal when your current one ends to avoid moving onto the lender’s SVR and save money.
It’s also common for homeowners to release equity when they remortgage. This means taking out a bigger loan against your property in order to free up some of the cash you’ve built up in it.
Remortgaging to release equity
Remortgaging to release equity is very common. For example, if your home is worth £300,000 and your mortgage balance is £150,000, you could remortgage to £180,000 and release £30,000.
This is often used for:
Home improvements, such as remortgaging for an extension.
When you apply for a mortgage, the lender will check your credit reports as part of the application process. Your credit report is like your financial CV and lists your history with credit cards, loans, mortgages etc over the past six years and whether you’ve kept up with your repayments.
Make sure you check your credit reports before a lender does, so you can get any mistakes corrected. Find out how to do this and ways you may be able to improve your credit score in our guide 11 Tips to improve your credit score for a mortgage.
Remortgaging with the same lender (product transfer)
Remortgaging with your current lender is known as a product transfer and if you’re borrowing the same amount over the same term it typically:
Does not require a solicitor or legal work.
Doesn’t require an affordability check.
Can be completed in around a week.
However, you may not get access to the best rates available across the market. A mortgage broker can compare deals across the market with what your current lender offers to find the right deal for you.
A Mortgage in Principle, also known as a ‘Decision in Principle’ is an indication that a lender is likely to lend to you, based on details you’ve provided about your income, spending and debts.
Next, it’s time to submit your application. If you’re switching lenders, the new lender will carry out affordability checks as part of the application process. This stage can be faster if you use a mortgage broker, as they’ll complete the application on your behalf.
If you’re remortgaging with a new lender, they will commission a mortgage valuation to make sure the property is worth the amount you’ve agreed to pay for it. A solicitor or conveyancer will handle the legal transfer.
9. Completion and switching to your new deal
Once everything is approved, your new mortgage will replace your old one on the agreed completion date.
As long as you get your remortgage in place in time, this will ensure you avoid moving onto your lender’s standard variable rate (SVR).
When your fixed rate ends, you are usually moved onto your lender’s standard variable rate (SVR). These are often around 6.5%-7.5%, so your monthly repayments could increase significantly.
For example, if your mortgage rate increases from 4% to 7% on your lender’s SVR, the monthly payments on a £200,000 mortgage taken out over 25 years would increase by around £250 a month.
This is why most people remortgage so their new deal is in place before their deal ends – to secure a new mortgage deal and avoid higher costs.
How does remortgaging work in the UK?
Remortgaging is when you switch to another mortgage, either with your current lender or a different one.
When you remortgage, your new lender pays off your existing mortgage and replaces it with a new deal secured against your home.
You stay in the same property – only your mortgage deal changes.
Video: When & How to remortgage
Prefer a quick overview? Watch our short video explaining when and how to remortgage.
Should you remortgage?
Remortgage Process
Key considerations when remortgaging
Before you remortgage, consider:
Timing: Start 3–6 months before your deal ends. In most cases this will give enough time to secure a new deal and avoid being moved onto your lender’s standard variable rate (SVR), which is usually more expensive.
Fees vs savings: Lower rates don’t always mean cheaper overall. Always factor in arrangement fees, legal fees and other costs, as a deal with a slightly higher rate but lower fees could work out cheaper. A fee-free mortgage broker will crunch the numbers for you.
Loan to value (LTV): Your LTV affects the deals available to you – the lower your LTV, the better the mortgage rates you’re likely to be offered.
Early repayment charges (ERCs): If you leave your current deal early, you may have to pay an early repayment charge, which can be costly and reduce any potential savings from remortgaging.
Your credit score and financial situation: Lenders will reassess your affordability, so a strong credit score and stable income will improve your chances of getting the best deals.
The 6 month rule: Lenders typically require borrowers to have been the registered owner for at least six months before remortgaging.
The complexity of your mortgage application. For example, if an underwriter asks for more information, this will take extra time.
Problems with your credit report. When you apply to remortgage the lender will check your credit score. So make sure every detail in your credit reports is correct because even a minor spelling mistake on your address could cause a problem.
Missing paperwork. You’ll need to provide various documents like payslips if you’re employed and documents like your SA302 tax calculations if you’re self-employed. So find out what you’ll need to submit in advance and dig them out to avoid delays.
Discrepancies with the property valuation. If there are any discrepancies in the mortgage valuation of the property this could cause delays.
If you’ve changed jobs recently. If you’ve changed jobs in the previous few months, it can make it harder to remortgage, especially if you have become self-employed.
What are the barriers to remortgaging?
There are a number of factors that can make it harder to remortgage:
Poor credit rating: Issues with your credit history can affect your remortgage chances, but this isn’t always the case and there are ways you can boost your credit rating. Find out more in our guide 11 tips to improve your credit score for a mortgage.
Your age: Lenders have upper limits on when they’ll need your mortgage to be repaid by. However, this upper limit ranges widely, typically from 70 to 85 years old. So if this is a concern for you, it’s important to get mortgage advice. Find more information in our guide mortgages for over 50s.
Affordability: Lenders will look at your income and outgoings when considering whether to lend to you or not. If your circumstances have changed for the worse since you last took out a mortgage, you may find it harder to remortgage. However, different lenders have different lending criteria, so speak to a fee-free mortgage broker and they’ll match you to the lender most likely to accept your application.
Debt to income ratio: This is the amount of your monthly income used to pay off debts like credit cards, a mortgage and personal loans and is a factor lenders consider when working out whether to lend to you and how much. If a high proportion of your income goes to paying off debts, you may find it harder to remortgage. However, don’t assume you can’t get a mortgage – speak to a mortgage broker to find out your options.
Don’t just look at the mortgage rate – always factor in any arrangement fees, mortgage valuation fees and legal fees. Some lenders offer free valuations and legal fees. A mortgage broker will factor these costs in when finding the right deal for you.
These are the remortgaging costs you may need to pay:
Remortgaging Costs
Typical cost
Early repayment charge
1%-5%, may reduce over the course of your deal.
Exit fee (also known as account fee)
£50 – £300
Arrangement fee
If charged, this is typically £500-£1,500
Legal fees
Lender may include this for free. If not, typical costs are £300+
Mortgage valuation fees
Lender may include this for free. If not, typical costs are £100 – £1500
Total costs are typically £0–£2,000+, depending on the deal.
Remortgage fees in detail
Early repayment charge If you’re tied into a deal, it’s likely that you’ll have to pay an early repayment charge if you remortgage before it ends. These are usually calculated as a percentage of the outstanding mortgage balance, typically 1%-5%. Read our guide Early repayment charges and how to avoid them.
Exit fees: Many lenders charge an exit fee for closing your mortgage account, although they may give it a different name.
Arrangement fees: Lenders often charge arrangement fees when you take out a mortgage with them. These vary but generally cost £500-£1,500.
Mortgage valuation fees:Mortgage valuation fees depend on the value of the property and lenders will have their own fee scale. Fees can vary significantly from £100 up to £1500. In many cases a lender will offer a free valuation.
Should I add remortgage fees to my loan?
You can either pay arrangement fees up front when you remortgage or add them to your loan. The latter is a common choice, but interest will be added to the fees and they will end up costing more overall.
It may be possible to remortgage with bad credit, but your options could be more limited and rates may be higher. Different lenders have different criteria, so it’s worth speaking to a fee-free mortgage broker who can advise on lenders most likely to accept your application.
Also, if you apply to remortgage and you’re rejected – don’t just reapply with a different lender because too many applications will damage your credit score – which could make it even harder to get accepted.
However, if you’ve been rejected by a lender, it may be even more useful to use a mortgage broker. They’ll be able to match you to the lender most likely to accept your application.
I own my house outright – can I remortgage?
Yes, if you own your home outright, you can take out a mortgage against it provided you meet the lender’s lending criteria. This is sometimes called an unencumbered mortgage.
Should you remortgage?
Whether or not you should remortgage will depend on your circumstances but here are common reasons to remortgage – and when not to.
Common reasons why people remortgage
Saving money by switching to a new deal when your current one ends, instead of being moved to your lender’s standard variable rate.
You’re already on your lender’s SVR and want to reduce the cost of your mortgage.
You’ve found a better mortgage rate than your current deal. However, you’ll need to take into account any fees involved in exiting your current deal like an early repayment charge.
Your circumstances have changed, such as if you’ve inherited some money, and you want to make mortgage overpayments but your current deal won’t let you, or will only let you overpay by a small amount, you may want to remortgage to a more flexible deal.
Moving to a fixed rate deal will give you certainty of your monthly mortgage outgoings. However, while the amount you’ll pay won’t increase in your initial period, it won’t go down either.
Your mortgage amount is small: If your remaining mortgage is relatively low (for example under £50,000), the fees involved in remortgaging may outweigh any potential savings.
Your early repayment charge is high: If you leave your current deal early, an early repayment charge (ERC) of 1–5% could make remortgaging too expensive to be worthwhile.
Your home’s value has dropped: If your property value has fallen and your equity is low (for example below 5%), you may have fewer deals available or struggle to remortgage.
Your credit history has worsened: If your credit score has declined since taking out your current mortgage, you may face higher rates or fewer lender options.
Your financial situation has changed: If your income has reduced or your outgoings have increased, you may not meet affordability checks for a new mortgage.
However, even if one of these applies, it’s still worth getting advice, as a mortgage broker may be able to find suitable options.
Remortgaging can be used in different ways when it comes to Buy to Let property, depending on whether you already own a rental property or are looking to invest in one for the first time. These scenarios work differently and usually require specialist advice from a mortgage broker.
Remortgaging a Buy to Let property you already own
If you already own a Buy to Let property, remortgaging can help you switch to a better rate, reduce monthly payments, or raise funds for property renovations or to expand your portfolio.
Some people remortgage their own house to release equity and use this money to buy a Buy to Let or holiday home. This can be a quicker way to raise funds but you’ll have two mortgages to manage, plus there’s the risk that both properties could fall in value.
Because your home is being used to support an investment, it’s especially important to understand the risks before going ahead. Read our guide How to invest in property in the UK.
Can my existing mortgage lender offer the best deal? The only way to find out if your existing mortgage lender offers the best deal is by comparing it with other lenders.
Factors to consider when deciding whether to switch lenders or stay with your current one:
Factor
Switching lenders
Staying with current lender
Can you access the best mortgage rates?
Yes. Although each lender will have its own criteria that you’ll need to meet.
Not necessarily. You’ll be limited to the rates your lender offers
Do you need a mortgage valuation?
Yes. You may need to pay for it
No
Is there legal work involved?
Yes. You may need to pay for it
No
Is there an affordability check?
Yes
Not usually if you’re borrowing the same amount for the same term
How quick is the process?
Allow 3 months but may be much quicker
Generally around a week
In summary: switching lenders may give you access to better rates, while staying with your current lender (a product transfer) is usually quicker and involves less paperwork.
There may be some alternatives to remortgaging, depending on your circumstances.
Extending your mortgage term
If you’re having difficulties paying your mortgage you should speak to your lender as soon as possible.
Lenders must treat you fairly and consider any request you make to change the way you pay your mortgage.
You may be able to reduce your monthly payments by extending your mortgage term, although this will increase the total amount of interest you pay over time.
If you want to access equity in your house but don’t want to remortgage, you may be able to borrow more from your existing lender.
This is known as a further advance and allows you to keep your current mortgage deal while borrowing additional funds, although the extra borrowing may be at a different rate.
Second charge mortgage
Alternatively, you may choose to take out a second charge mortgage, also known as a homeowner loan.
This allows you to borrow against your home with a separate lender without changing your existing mortgage, but it increases your overall debt and risk. Read more in our guide Homeowner Loans explained.
Yes. Remortgaging with your current lender is known as a product transfer. It’s usually quicker and involves less paperwork, as affordability checks and valuations are often not required. However, you may not have access to the best rates available on the wider market.
Do I need a solicitor to remortgage?
If you’re switching lenders, you’ll usually need a solicitor or conveyancer to handle the legal work. Many remortgage deals include free legal services. If you’re staying with your existing lender, legal work is typically not required.
What documents do I need to remortgage?
Common documents include recent payslips or proof of income, bank statements, photo ID, and details of your existing mortgage. If you’re self-employed, you may also need tax calculations or accounts. Having paperwork ready can help avoid delays.
How much does it cost to remortgage?
Remortgaging costs vary but may include arrangement fees, valuation fees, legal fees, exit fees, and early repayment charges. Not all fees apply to every remortgage, and some lenders include certain costs for free.
How does a remortgage work?
A remortgage works by replacing your existing mortgage with a new deal, either with your current lender or a different one. The new lender repays your old mortgage on completion, and you begin making payments under the new rate and terms. The process usually takes 4-8 weeks.
Does gambling affect a mortgage application?
Gambling can negatively affect a mortgage application, although this will depend on factors including which lender you apply to, how much money is being staked and how frequently you are gambling.
How to take 10 years off a 30 year mortgage
If you want to take 10 years off a 30 year mortgage, one way you can try to do this is by making mortgage overpayments, either regularly or as a lump sum. But make sure you check if your lender limits how much you can overpay by each year penalty-free otherwise you may have to pay an early repayment charges.
Alternatively, when you remortgage, you could consider reducing the 30 year term to 20 years. Although, be aware that your repayments may rise steeply and you’ll also need to meet the lender’s affordability criteria.
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