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How Does Remortgaging Work?

Remortgaging is the process of changing your mortgage from one lender or product to another. How does remortgaging work? In effect, the new lender repays the balance on your existing loan, and you open a new mortgage account.

Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

Almas Uddin2023-05-09
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How Does Remortgaging Work?

Remortgaging is the process of changing your mortgage from one lender or product to another. How does remortgaging work? In effect, the new lender repays the balance on your existing loan, and you open a new mortgage account.

Can I remortgage my house at any time? There are lots of considerations when deciding which remortgage product is right for you, and the timing could make a big difference to your overall costs.

We’ll explain how does remortgaging work UK and all the information you need to make informed choices.

What Happens When You Remortgage?

For most homebuyers, their first mortgage will be on a fixed rate. That means you pay the same amount every month for a specific period, normally up to five years.

What does remortgage mean? Simply that you replace your current mortgage with a new one. You can do this as many times as you wish, provided you aren't breaching the terms of a fixed-term deal and are aware of any valuation or product costs.

Can I remortgage without paying any fees? Some lenders offer remortgages with free legal fees or low product charges, but it is important you understand the total costs before you pick a remortgage.

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Most lenders will let you borrow 4.5 times your annual salary so, as long as you have a standard 10% deposit, you should be able to borrow this much.


Depending on your personal circumstances, some lenders may let you borrow 5 times your salary.


Lenders usually cap the amount they lend at 5.5 times your salary, so it’s unlikely you’ll be able to borrow more than this.

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Can I Get a Remortgage at Any Time?

If you are on a fixed-term mortgage agreement or have a mortgage with a discounted rate, you may have to pay exit charges if you remortgage before the end of the term.

How does a remortgage work at the end of your term? The lender will normally switch your mortgage onto their Standard Variable Rate (SVR), which is likely to make your mortgage costs more expensive, so you can remortgage before the term ends to avoid paying higher interest.

How Does Remortgaging Work to Save Money?

Borrowers that remortgage at a cheaper interest rate or more competitive mortgage terms can save a sizable amount on their monthly repayments. However, you need to know the terms, costs, interest charges and other fees to make sure your remortgage is saving you money.

What is a remortgage early payment charge? Lenders can levy a fee if you exit the agreement too early, but you can usually apply for a remortgage agreement in advance and implement the deal when your current agreement ends.

What Is Remortgage Costs?

Remortgage lenders can charge product fees, application costs and valuation fees. If these charges are rolled up into the mortgage, it may be unclear how much you are paying in total because the fees aren't separated from your monthly repayments.

Working with a broker allows you to work out which remortgage offers the best value for money, including fees and other rolled-up charges.

What Is a Remortgage APR?

The Annual Percentage Rate of Charge (APRC) is the interest rate your remortgage lender is charging. You can compare the APRC between remortgage offers to see which products are the most competitive.

What is a remortgage loan to value? Lenders might mention the LTV, which means the ratio of what you'd like to borrow against what your property is worth. A lower loan-to-value means you can usually find a better interest rate or a more competitive remortgage.

How does a mortgage work in terms of valuations? The lender will normally arrange a valuation to check what your property is worth – you can also look on Zoopla to get a rough indication.

If the lender offers a maximum LTV of, say, 75%, you can work out the upper limit you can remortgage your property for by taking the market value and multiplying it by the same percentage.

How Does Remortgaging Work for Property Valuations?

A lot depends on the lender. Some will arrange a full inspection, others will value the property from the exterior, and others will organise a desktop valuation without an in-person visit.

Can I remortgage my house if the valuer thinks the property is worth less? Potentially, yes, you can appeal a valuation that appears to be too low, but you can also consider other lenders or remortgage products with a higher maximum LTV.

Can I Remortgage At a Lower Interest Rate?

Many lenders offer introductory deals to attract new customers, such as a low tracker rate or a fixed or discounted interest charge for the initial years of the mortgage.

What is a remortgage introductory deal? These agreements make your mortgage more affordable, often for two to five years, after which time you will end up on the lender's SVR unless you remortgage with a different lender or onto a different mortgage product.

Can I Remortgage My House to Achieve Greater Flexibility?

If you'd like to make overpayments or switch to an offset mortgage, a remortgage could be a good solution. You can remortgage at any point, fixed-term agreements notwithstanding if another lender offers greater repayment flexibility.

How Does Remortgaging Work for Debt Consolidation?

Homeowners who own a property worth more than their outstanding mortgage can remortgage to a higher value, using the extra borrowing to repay other loans.

Can I remortgage to repay any type of debt? The lender may ask for information about the debts you plan to consolidate, and they will need to ensure there are no affordability issues that might affect your ability to keep up with the mortgage repayments.

How does remortgage work to reduce overall debt costs? The interest rates on long-term mortgage borrowing are normally significantly lower than credit cards or personal loans, so you can consolidate all debts in one place and repay the balance gradually with a lower interest rate.

However, the total repayments may be higher if your mortgage is over a standard 20-to-25-year term.

How Does Remortgaging Work With a Broker?

An independent, whole-of-market mortgage brokers will ensure you select the right remortgage lenders and products for your borrowing requirements and circumstances.

Can I remortgage my house through porting? Porting means you move your mortgage to a new property and may be an option if you don’t wish to remortgage or are already on a very good deal and want to bring your mortgage with you.

What happens when you remortgage? The lender will run through valuations, affordability assessments, credit record checks and other evaluations to ensure they can offer you the amount you wish to borrow, secured against your property.

Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

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Frequently Asked

Generally, yes, you can remortgage whenever you like. However, if you are within a fixed-term period, it may be worth waiting until this ends to avoid steep repayment penalties.

Affordability assessments mean the lender looks at your income and outgoings, debt and assets to ensure you have the means to keep pace with your mortgage repayments.

If your property is worth more than your mortgage, and you have the equity to borrow a greater amount, you can remortgage for a higher value than your existing mortgage and use the extra capital for other purposes, such as paying for home improvements.

Possibly, depending on the lender’s criteria. Some banks and mainstream lenders will not offer a remortgage to anybody with a less-than-perfect credit score, whereas others will specialise in bad credit and be happy to review your application.

The current mortgage is repaid by the new lender, with a solicitor to manage the contractual paperwork. Having two mortgages (such as a second-charge mortgage) is a different scenario, and after remortgaging, you have only one mortgage product.

An offer is an initial proposal from the lender, and you can negotiate the offer, decide whether to accept or reject it or collate offers from more than one lender to compare the rates and costs.

By remortgaging onto a lower interest rate or remortgaging each time you reach the end of a fixed-term interest period, you can avoid going onto the lender's SVR, which is very likely to be higher.

Remortgage means you take out a different mortgage product with the same lender or remortgage through a new lender, to repay your current mortgage balance.

Remortgaging works by paying back a current home loan. You can use remortgage borrowing to pay back your mortgage, release equity from your property, consolidate debts, or reduce your mortgage costs by choosing a product with lower interest rates or fees.

If your mortgage has passed the end of a fixed-term deal or is within six months of that date, you can remortgage without paying an early exit charge.

You can remortgage a rental property in much the same way as a residential home. The lenders offering buy-to-let remortgages may differ from those specialising in domestic lending, and the product structures and fees will be different. For example, most buy-to-let mortgages are interest-only.

A lender will always need to run a credit check to ensure you don't have any adverse credit issues that make you ineligible for the lender's remortgage products. If you have bad credit, you may be advised to remortgage through a niche lender.

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FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature.

We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

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