Remortgaging with your current lender, often referred to as a product transfer, can be a straightforward and cost-effective way to secure a better mortgage deal. While it may seem like a simple process, enlisting the help of a mortgage broker can make a significant difference, even when staying with your existing lender. Here’s everything you need to know about remortgaging with the same lender and why a mortgage broker is a valuable ally.
Why Remortgage with the Same Lender?
Choosing to stay with your current lender has several benefits:
- Simplified Process: Your lender already has your financial details, making the application process quicker and easier.
- Lower Costs: Many fees associated with switching lenders, such as legal and valuation fees, are often avoided.
- Convenience: No need to undergo a property valuation or a full financial reassessment unless your circumstances have changed significantly.
While these advantages are appealing, it’s essential to ensure you’re securing the best possible deal.
What Do You Need to Remortgage with the Same Lender?
When remortgaging with your current lender, you’ll need to consider the following:
Mortgage Account in Good Standing
Your existing mortgage should be up to date with no missed payments. Lenders are less likely to offer new deals if your account is in arrears.
Loan-to-Value (LTV) Ratio
Your lender will review your LTV ratio to determine the deals you qualify for:
- A lower LTV (e.g., 60% or below) can unlock more favourable interest rates.
- If your property’s value has increased, it’s worth confirming whether your new LTV places you in a better rate bracket.
Updated Financial Information
Your lender may reassess your financial situation, especially if you’ve had changes in:
- Employment or income levels.
- Additional debts or financial commitments.
Documentation
While less extensive than switching lenders, you may still need to provide:
- Recent payslips or tax returns (if self-employed).
- Bank statements to verify your financial health.
Preferred Terms
Decide on the type of mortgage deal that suits you best:
- Fixed-rate for predictable monthly payments.
- Tracker or variable rate if you’re comfortable with fluctuations.
The Importance of a Mortgage Broker
Even if you plan to remortgage with your current lender, working with a mortgage broker can offer significant advantages. Here’s how they can help:
Market Comparison
Mortgage brokers have access to a wide range of deals, including exclusive offers not available directly to consumers. They can:
- Compare your lender’s product transfer options with other deals in the market.
- Highlight opportunities that may save you more money in the long term.
Unbiased Advice
A broker works for you, not the lender, ensuring their recommendations align with your financial goals. They can advise whether staying with your lender is truly the best option or if switching would yield better benefits.
Negotiation Support
Brokers often have strong relationships with lenders and can:
- Negotiate better terms on your behalf.
- Highlight your loyalty as a customer to secure perks like fee waivers or discounted rates.
Understanding Complex Situations
If your financial circumstances have changed—such as a new job, reduced income, or additional debts—a broker can guide you through the process and present your case favourably to the lender.
Time and Stress Savings
Brokers handle much of the legwork, from liaising with the lender to managing paperwork. This allows you to focus on other priorities while they secure the best deal for you.
Future Planning
A mortgage broker can help you plan beyond your immediate remortgage. They may suggest:
- Shorter or longer-term fixed-rate options based on market trends.
- Strategies to reduce your overall mortgage costs.
Steps to Remortgage with the Same Lender
Review Your Current Mortgage Terms
Identify when your fixed or promotional rate ends to avoid being transferred to the lender’s standard variable rate (SVR).
Contact Your Lender
Ask for details of their latest deals and assess whether they meet your needs.
Consult a Mortgage Broker
Share your lender’s offers with a broker and let them compare them with other market options. Their advice ensures you make an informed decision.
Evaluate the Costs
Check for potential arrangement fees or early repayment charges if you’re exiting a deal early.
Complete the Process
Once you’ve decided on the best deal, your broker can help you finalise the paperwork and ensure a smooth transition.
Benefits of Staying with the Same Lender
Lower Costs
Many lenders waive valuation, legal, and arrangement fees for existing customers.
Faster Process
Since the lender already holds your details, approvals are quicker and require less paperwork.
No Credit Check
Unless you’re borrowing more, most lenders won’t perform a new credit check, which can help preserve your credit score.
Costs to Watch For
Even with your current lender, some fees may apply:
- Arrangement Fees: Often charged for new deals, even for existing customers.
- Early Repayment Charges (ERCs): If you’re exiting a deal before the term ends, these could be significant.
Remortgaging with the same lender is a convenient option for many UK homeowners, but it’s not always the most cost-effective. A mortgage broker can help you navigate the process, compare deals, and negotiate better terms to ensure you’re making the best financial decision.
By understanding what you need to remortgage with your current lender and enlisting the expertise of a broker, you can maximise savings and streamline the process—putting you in the best position for your financial future.
FAQs
What is a product transfer, and how does it relate to remortgaging with the same lender?
A product transfer is when you switch to a new mortgage deal with your existing lender, rather than moving to a different lender. It’s often considered a form of remortgaging and allows you to secure a better interest rate or change your mortgage terms without the hassle of switching providers.
Do I need a credit check to remortgage with the same lender?
In most cases, remortgaging with the same lender does not require a new credit check, especially if you are not borrowing additional funds. However, if your financial situation has changed or you request a significant alteration to your mortgage terms, your lender might conduct a review.
What documents do I need to remortgage with the same lender?
The documentation required is usually minimal compared to switching lenders. You may need:
- Identification documents if requested for compliance purposes.
- Proof of income (recent payslips or tax returns if self-employed).
- Bank statements to verify affordability.
Can I remortgage with the same lender if my financial situation has changed?
Yes, but your lender may reassess your affordability if there have been significant changes, such as a new job, reduced income, or increased debts. Consulting a mortgage broker can help you navigate these situations and present your case effectively.
Are there fees associated with remortgaging with the same lender?
While many lenders waive valuation and legal fees for product transfers, you may still encounter:
- Early repayment charges (ERCs) if exiting your current deal before its term ends.
- Always confirm any fees with your lender upfront.
- Arrangement fees for the new mortgage deal.
How does my Loan-to-Value (LTV) ratio affect remortgaging with the same lender?
Your LTV ratio determines the deals available to you. A lower LTV often qualifies you for better interest rates. If your property’s value has increased, it’s worth confirming whether this change places you in a more favourable LTV band.
Can I remortgage with the same lender if I want to borrow more money?
Yes, this is possible, but it’s treated as an additional borrowing request. Your lender will review your financial situation, including income, expenses, and credit history, before approving extra funds.
Do I need a mortgage broker to remortgage with the same lender?
While not mandatory, a mortgage broker is highly recommended. They can:
- Compare your lender’s offers with the broader market to ensure you’re getting the best deal.
- Negotiate on your behalf for better rates or fee waivers.
- Simplify the process and save you time.
How long does it take to remortgage with the same lender?
The process is usually faster than switching lenders, often taking 2–4 weeks, as your lender already has your financial details and property valuation. If no significant changes are involved, it could be completed even sooner.
Is remortgaging with the same lender always the best option?
Not always. While it’s convenient and cost-effective, your lender’s deals may not be the most competitive. Comparing their offers with the wider market can help ensure you’re making the best financial decision.
Can I switch mortgage deals with my current lender early?
Yes, but be aware of early repayment charges (ERCs) if you exit your current deal before the agreed term. Review your mortgage agreement to understand the potential costs.
How does a mortgage broker help with remortgaging the same lender?
A broker provides expert advice, comparing deals across the market and within your lender’s portfolio. They can also negotiate better terms, manage the paperwork, and save you time and stress during the remortgage process.
What if my property value has increased since my last mortgage?
If your property’s value has risen, it could improve your Loan-to-Value (LTV) ratio, potentially qualifying you for better interest rates. A mortgage broker or lender can help reassess your new LTV band.
How can I prepare for a remortgage with the same lender?
- Review your current mortgage terms and deal end date.
- Check your financial situation, including income and expenses.
- Compare your lender’s offers with the broader market.
- Seek advice from a mortgage broker for tailored guidance.
Continue Reading