Remortgages

A remortgage calculator can help you to find and compare remortgage deals. Our calculator works out your loan-to-value (LTV), based upon your house price and how much you need to borrow. It will show you the mortgages – including interest rates and product fees – that are available and the total amount payable over your mortgage deal. You can refine your results further by interest rate type, such as fixed rate or variable.

You will need to know how much you have left to pay off your mortgage and your property’s current value. You then divide your outstanding mortgage balance by your property’s value. For example:

• You have £200,000 left to pay on your mortgage
• Your property is worth £350,000
• Divide £200,000 by £350,000 = 0.57
• 0.57 x 100 = 57 – this makes your LTV 57%.

A remortgage means changing from your existing mortgage deal to a new one without moving home. You can remortgage with your existing lender, but you may want to remortgage with a different lender instead if they offer a better rate of interest. You can also use a remortgage to release equity, for example to buy a second home, either for your holidays or as a buy-to-let property. Read our guide to remortgaging to learn more. 

There are four reasons to remortgage:

1. Reduce your total and monthly mortgage costs – by finding a lower interest rate and minimising fees to switch.
2. Release equity – you may want to access some of the cash tied up in your home and use this to invest in other properties or for personal spending. If you are not ready to remortgage, you could ask your existing lender for a further advance instead.
3. Consolidate debts – remortgaging might reduce your overall monthly credit payments if you can secure this at a lower rate of interest than you may currently be incurring. Other options include a personal or secured loan.
4. More choice and more flexible products – if you now qualify for a lower LTV product, you likely have an increased range of choice in the market (if you are starting at above 75% LTV) and this comes with a better chance to find a product that allows payment holidays, underpayments or drawdown for example.

• See if your LTV has changed since your last mortgage deal. A lower LTV could open-up potentially lower interest rates, saving you money compared to your last mortgage – read our guide to What is LTV.
• Make sure you keep a note of your mortgage end date. Your provider should write to you and give you notice but it is best to start looking at mortgage rates in advance of this.
• Don’t automatically accept your existing mortgage lender’s remortgage offer. Make sure you compare remortgage rates and you could save a lot of money in reduced interest costs. Our chart calculates the total interest you will pay over the mortgage deal period.
• Check the total costs of your remortgage. This includes product fees to switch and, especially if you have a fixed rate mortgage, any early repayment charges that might apply on your current mortgage deal. Our table calculates the total interest cost for you and shows the product fees to help you work out if a remortgage will save you money.
• Have your circumstances changed since your last mortgage? When you remortgage to a new lender, you will need to complete a full mortgage application and affordability check. However, your existing lender may allow you to switch under an ‘execution-only’ basis, which means they only need you to select a product to start the remortgaging process. If your financial situation has changed since your last mortgage deal, you should inform your mortgage lender of this.
• See if your credit rating has changed since your last mortgage deal. Before remortgaging it's important to check your credit score. As part of the mortgage application process, your chosen lender will run a credit check on you and whoever else you may be buying the property with. 

You may be able to borrow more when you remortgage. This will depend on your financial circumstances, such as your credit score and levels of affordability. An alternative to a remortgage (for example if you are locked into a deal and don’t want to incur early repayment charges) is to ask for a further advance from your current mortgage lender.

A further advance is when you borrow an additional sum of money, usually at a rate of interest different to your mortgage deal. Sometimes this will be on a deal with no repayment restrictions, meaning that once your main mortgage comes to an end, you can join both pots of borrowing together and remortgage onto one single product.

When you remortgage, you may need to pay a product fee – sometimes your existing lender may offer a reduced fee as part of an incentive to remortgage with them. In addition, if you are moving lender you will probably need to pay a valuation fee. However, many lenders as part of wanting to attract new remortgage business will offer these free of charge.

You can find out more about mortgage fees in our guide What fees do I need to pay when getting a mortgage.

You can compare mortgage rates and fees using our remortgage charts:

• Two year fixed rate remortgage
• Five year fixed rate remortgage
• Discounted variable remortgage
• Three year fixed remortgage
• 80% LTV remortgage

The table above shows mortgages at 75% on a repayment basis

When comparing remortgage deals, you should look at the total amount you will pay over the deal period. Above shows an example for a 75% LTV mortgage, on a repayment basis over a two-year fixed deal. While option one has the lowest initial interest rate, the fee makes this more expensive. The best remortgage deal in the example above is option two, which is £756.72 cheaper than option three, the most expensive.

Some mortgages will apply early repayment charges. which means that if you leave the mortgage deal before the deal period ends you will have to pay a penalty. This is usually a percentage fee of your mortgage balance and can make switching very expensive.

There is now more flexibility from lenders to give mortgage terms past the age of 65. Many have extended their maximum borrower ages and some now have no maximum at all. Our guide to Mortgage tips for over-70s can tell you more about borrowing in later life. In addition, you may want to consider a retirement interest-only mortgage or equity release.

It’s important to check your credit score to make sure it is high enough to qualify for a mortgage. If you are switching to a new lender, you will need to meet their affordability requirements. You can prepare for this by reviewing your outgoings and reducing or removing unnecessary spending or bills.