Photo by Ethan Wilkinson on Unsplash
If you’re coming to the end of a fixed-rate mortgage deal, you’ve probably noticed the letters starting to arrive. They’re usually vague — something like “your current deal is ending soon” — and they rarely spell out what happens if you do nothing. What happens is this: you get moved onto your lender’s standard variable rate (SVR), which is almost always more expensive than any deal you could get by shopping around.
Remortgaging just means switching your mortgage deal — either to a new rate with your current lender, or to a new lender entirely. It’s one of the few genuinely high-value financial admin tasks most people can do in an afternoon. Get the timing and the maths right, and you could save yourself hundreds of pounds a month. Get it wrong — or just not bother — and you’ll quietly pay more than you need to for the next two to five years.
This guide walks through when to start looking, how to actually compare deals properly, the costs people forget about, and the mistake that catches out more homeowners than any other.
Why your standard variable rate is costing you more than it should
When your fixed or tracker deal ends, your mortgage doesn’t disappear — it just rolls onto your lender’s SVR. This is the rate the lender sets itself, and it’s typically several percentage points higher than the fixed deals available on the open market. There’s no fixed national SVR; each lender sets its own, but they’re consistently among the most expensive ways to hold a mortgage.
On a £200,000 mortgage, a few percentage points of difference can mean paying an extra £200–£400 a month compared to a competitive fixed deal. Over a year, that’s thousands of pounds — money that’s gone, with nothing to show for it.
Lenders don’t move you onto the SVR to catch you out maliciously — it’s just the automatic default. But it means the burden is on you to act before your current deal ends, not after.
When to start looking for a new deal
Most fixed-rate deals can be secured 3 to 6 months before your current one ends, and many lenders will let you lock in a new rate even earlier. Mortgage offers are typically valid for three to six months, so there’s little downside to arranging a new deal early — if rates drop before your current deal ends, you can usually switch to the better rate; if they rise, you’ve already locked in the lower one.
A good rule of thumb: mark your deal’s end date in your calendar now, and start comparing options six months out. Checking late — a few weeks before your deal ends — is the single biggest reason people end up on the SVR by default, even temporarily, while a new application goes through.
How much you could actually save
The savings depend entirely on your mortgage balance, the gap between your current rate and the new one, and how many years are left on the mortgage. Here’s a simplified illustration based on a £200,000 repayment mortgage with 20 years remaining:
| Current rate | New rate | Monthly payment (approx) | Monthly saving | Annual saving |
|---|---|---|---|---|
| 6.5% (SVR) | 4.5% (new fixed deal) | £1,340 → £1,120 | ~£220 | ~£2,640 |
| 5.5% | 4.5% | £1,220 → £1,120 | ~£100 | ~£1,200 |
| 4.5% | 4.0% | £1,120 → £1,070 | ~£50 | ~£600 |
These are illustrative figures to show the scale of difference, not a quote — your actual numbers depend on your mortgage term, balance, and the deals available when you apply. The point is simple: even a 0.5% difference in rate is worth comparing properly, and the jump from SVR to a competitive fixed rate is usually the biggest saving available to you.
The misconception that costs people the most: “my current lender will give me the best deal automatically”
This is the mistake that catches out more homeowners than anything else. Many people assume loyalty is rewarded, or that switching lenders is too much hassle, so they just accept whatever their existing lender offers when their deal ends — sometimes called a “product transfer.”
Product transfers aren’t bad — they’re often quicker, with less paperwork, and don’t always require new affordability checks. But they’re not automatically the cheapest option. Lenders compete for new customers more aggressively than they compete to keep existing ones, which means the best rate on the market is frequently with a different lender altogether.
The sensible approach: get your existing lender’s product transfer rate as a baseline, then compare it against what’s available elsewhere — either by checking a whole-of-market mortgage broker or comparing rates directly. If your current lender’s offer beats the market, great, stick with them. If not, switching takes more paperwork but the saving is yours to keep.
The costs people forget to factor in
Remortgaging isn’t free, and the fees can eat into your savings if you don’t account for them. The main ones to check for each deal:
- Arrangement/product fee — often £0–£2,000, sometimes added to the loan itself (which means you pay interest on it)
- Valuation fee — some lenders cover this, others don’t
- Legal fees — many remortgage deals include free legal work; check before assuming
- Early repayment charge (ERC) on your current deal, if you switch before it ends — this can be substantial, often 1–5% of the remaining balance
- Exit fee — a small admin charge from your current lender, separate from the ERC
A deal with a lower rate but a high arrangement fee isn’t automatically cheaper than a slightly higher rate with no fee — always compare the total cost over the deal period, not just the headline rate.
What lenders check — and how to improve your position before applying
Remortgaging involves a fresh affordability assessment, even if you’re staying with the same lender via a product transfer (though these checks are sometimes lighter). Lenders look at your income, outgoings, credit history, and — critically — your loan-to-value (LTV) ratio: how much you’re borrowing compared to the property’s value.
A lower LTV usually unlocks better rates. If your property has gone up in value, or you’ve paid down a chunk of the mortgage, you might have moved into a better LTV bracket (say, from 85% to 75%) without realising — and that alone can qualify you for meaningfully better rates.
Before applying, it’s worth checking your credit report for errors, avoiding new credit applications in the months before remortgaging, and gathering recent payslips and bank statements in advance so the process doesn’t stall.
Fixed vs tracker: what you’re actually choosing between
This is worth understanding plainly, because the terminology puts people off:
| Type | How it works | Best for |
|---|---|---|
| Fixed rate | Rate stays the same for the deal period (usually 2 or 5 years) | People who want predictable monthly payments and protection if rates rise |
| Tracker rate | Moves in line with the Bank of England base rate, plus a set margin | People comfortable with payments changing, betting rates may fall |
| Standard variable rate (SVR) | The lender’s own default rate — can change anytime | Nobody, long-term — it’s a holding position, not a destination |
Most homeowners choosing between a fix and a tracker are really deciding how much uncertainty they’re willing to live with. A fixed rate costs you flexibility; a tracker costs you predictability. Neither is objectively right — it depends on your appetite for risk and how tight your monthly budget already is.
How to actually compare deals without getting overwhelmed
You don’t need to understand every mortgage product on the market — you need to compare a shortlist properly. A practical approach:
- Check your current lender’s product transfer rate first (takes five minutes via their app or website)
- Use a mortgage broker or comparison tool to see what’s available elsewhere at your LTV
- Compare the total cost over the deal period — rate, fees, and any cashback — not just the monthly payment
- Check the ERC on any new deal, in case your circumstances change and you need to exit early
- Confirm the offer in writing before your current deal ends, so there’s no gap
The MoneyHelper mortgage calculator is a free, independent way to model different rates and terms before you commit to anything. It’s run by the government-backed MoneyHelper service, so there’s no product being sold to you.
The bottom line
- Put your mortgage deal’s end date in your calendar now, and start comparing options six months before it ends — not six weeks.
- Don’t assume your current lender’s product transfer is the best deal available; use it as a baseline and compare against the wider market.
- Compare total cost over the deal period, not just the headline rate — arrangement fees and early repayment charges can change which deal is actually cheapest.
- Check whether your loan-to-value has improved since you last took out a mortgage — you may qualify for a better rate bracket than you expect.
- If you do nothing, you’ll land on your lender’s standard variable rate by default — the one outcome that’s rarely in your financial interest.
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