If your fixed rate is coming to an end, or you have already slipped onto your lender's standard variable rate, you are probably wondering whether now is the right time to remortgage. It is one of the most common questions we are asked at CGR Financial, and the honest answer is: it depends on your circumstances. This guide explains the signs that it may be time to switch, when it might be worth staying put, and how the process works for homeowners across Northern Ireland.
What does remortgaging actually mean?
Remortgaging simply means moving your existing mortgage onto a new deal. That can be with your current lender (often called a product transfer) or by moving to a different lender altogether (a full remortgage). You are not moving house; you are just changing the deal on the home you already own, usually to secure a better interest rate, to borrow more, or to change how your mortgage works.
When should you think about remortgaging?
There is rarely one perfect moment, but these are the situations where it usually pays to look at your options.
Your current deal is ending. This is the big one. Most fixed and tracker deals run for two or five years, and when they end you are automatically moved onto your lender's standard variable rate (SVR), which is typically much higher than the deal you were on. It is worth starting to look around three to six months before your current deal ends, because most new mortgage offers are valid for up to six months. That means you can line up a new rate in advance and switch the day your current deal finishes, with no gap on the expensive SVR.
You are already on the standard variable rate. If your deal ended a while ago and you have been sitting on the SVR, you could be paying significantly more than you need to. This is usually the first thing worth reviewing.
Your home has gone up in value. Mortgage rates are banded by loan-to-value (how much you owe compared with what your home is worth). If your home has risen in value, or you have paid down a chunk of the balance, you may have dropped into a lower loan-to-value band, which can unlock better rates.
You want to borrow more. Some homeowners remortgage to release equity for home improvements or another significant purpose. Whether this is right for you depends on your wider circumstances, and it is something we would always talk through carefully.
You want your mortgage to work differently. You might want the certainty of a new fixed rate, the flexibility to make overpayments, or a change to your mortgage term. A remortgage is a natural point to review all of this.
When might it be better to wait?
Remortgaging is not always the right move, and part of our job is to tell you when it is not.
- You are still tied into your current deal. Many fixed deals carry an early repayment charge (ERC) if you leave before the end of the term. This can run to thousands of pounds, so it often makes sense to time your switch for when the ERC no longer applies (though occasionally the savings still outweigh the charge, which is worth checking).
- Your mortgage balance is small. If you only have a little left to pay, the fees involved in switching can outweigh the interest you would save.
- Your circumstances have changed. A change in income, employment, or credit history can affect what you qualify for. It does not necessarily rule out a remortgage, but it is worth getting advice first.
Product transfer or full remortgage?
There are two ways to secure a new deal, and the right one depends on your situation.
A product transfer means staying with your current lender and moving onto one of their new deals. It is usually quick and involves little paperwork, because your lender already has your details and often does not require a new affordability assessment or valuation.
A full remortgage means moving to a new lender. It can take a little longer and involves an affordability check, a valuation, and some legal work, but it opens up the whole market, which can mean a better rate or terms that suit you better.
As a broker, we compare both routes for you so you can see the true cost of each, not just the headline rate. You can read more about our remortgage service here.
The costs to weigh up
When you compare deals, it is the overall cost that matters, not just the interest rate. Depending on your situation, a remortgage can involve an arrangement or product fee, a valuation fee, legal or conveyancing costs, an exit or deeds-release fee from your old lender, and any early repayment charge if you are still tied in. The good news is that many remortgage deals come with a free valuation and free basic legal work, and part of our role is to factor all of this in so you can compare like for like.
Does it work differently in Northern Ireland?
Mortgage rates and lenders are broadly the same across the UK, as most lenders operate nationally, so homeowners in Northern Ireland have access to the same deals as those in the rest of the UK. The main local differences are around conveyancing and solicitors, and occasionally around certain property types. Because we are based here and work with clients right across Northern Ireland, we are used to handling the local side of things.
How CGR Financial can help
Rather than checking one lender's deals, we look across a wide range of lenders to find the option that fits your circumstances, and we handle the legwork and paperwork for you. We will also flag when it is not worth switching, so you can make the decision with the full picture in front of you. If your current deal is ending in the next six months, it is a good time to have a conversation.
You can also compare typical mortgage rates in Northern Ireland to see how deals vary by deposit size, then talk to us about what you would actually qualify for.
This article is for general information and does not constitute mortgage advice. Any recommendation would be based on your individual circumstances following a conversation with us.
CGR Financial Ltd is an Appointed Representative of PRIMIS Mortgage Network, a trading name of First Complete Ltd. First Complete Ltd is authorised and regulated by the Financial Conduct Authority. Your home may be repossessed if you do not keep up repayments on your mortgage.