How does remortgaging work?

It’s best to start planning to remortgage 6 months before the end of your current fixed rate term. If you apply for a remortgage through Saga Mortgages 6 months before your current deal ends, you can lock in a rate ready to move onto.

If interest rates decline in those 6 months, Saga Mortgages can submit a new application for you at no extra charge, so you don’t lose out on the lower rates. 

Yes, it is possible for you to remortgage before the end of your current fixed rate deal. However, leaving your current deal early could result in you having to pay an Early Repayment Charge (ERC), which could make switching more expensive.

If you remortgage onto a lower interest rate, the amount you could save per month in interest could balance out the cost of switching.

To find out whether remortgaging early is right for you, speak to an expert in mortgages like the Saga Mortgages team, who can help you weigh up whether remortgaging early is right for you.

A remortgage can take weeks or sometimes months, depending on how far away you are from your current deal ending, if you are switching providers and if you’re keeping your loan value the same. If you stay with your current provider through a product transfer, this will be quicker.

If you are remortgaging to a new lender, this will take longer because the new lender will want to conduct a full affordability assessment before approving your application. Working with experienced mortgage advisors like the team at Saga Mortgages can also help speed up the process, as your dedicated advisor will do a lot of the admin work for you. 

When you remortgage you can typically borrow the same amount that is outstanding on your current mortgage loan, but you could borrow more to release money from your home. Most mortgage lenders would consider lending up to 90% Loan to Value (LTV).

To borrow the higher amount, your income must also be sufficient to fund the larger mortgage. The lender will also assess your day-to-day living costs and credit rating, as well as the value of your home to determine how much you can remortgage your house for.

Remortgaging isn’t necessarily expensive, but there are some costs involved. You may have to pay a booking fee, which is charged by some lenders to ‘book’ your deal, although this isn’t very common. You also may have to pay an arrangement fee, which is for a lender to secure the best interest rate possible for you. The lender will also want to value your property, so there may also be a valuation fee.

Lastly, to register the new mortgage lender on your property deeds, you may also have to enlist the help of a solicitor, however most lenders offer free legal servicing so this may not come at any additional cost.

If you want to release money from your property to give to a loved one, for example your child who wants to buy a home of their own, it’s worth considering a Deposit Boost instead. This involves taking out a small mortgage to release capital from your property, which you can then give to your child as part of their deposit, or as their entire down payment.

Another alternative is equity release, which is a way of unlocking money from your home, normally through a lifetime mortgage. You’ll take out a loan secured against your home, which is then paid back once the home is sold after you’ve passed away or moved into long-term care.

Saga Mortgages is a service provided by Tembo, available exclusively to Saga. You’ll benefit from their award-winning advice from a friendly, experienced team of mortgage professionals, who are available 7 days a week.

They’ll search all the available options to find the best option and mortgage rate for you, including specialist products bespoke to Saga Mortgages.

The Saga Mortgage service enables you to book an appointment with Tembo's award-winning mortgage advisors. Simply complete our online fact find and, if you’re eligible, you’ll be directed to book an appointment.

The team is available 7 days a week, ready to answer any questions you may have.

With Saga Mortgages, you will have access to mortgage advice through our partner Tembo. Their award-winning mortgage advisors will search over 20,000 mortgage products and over 100 lenders to find the most suitable and best priced deal for you.

This includes all the high-street lenders you’ll be familiar with, like Nationwide, Halifax, Lloyds, Barclays and HSBC, as well as smaller, specialist lenders like Livemore and Generation Home.

All mortgage advice through Saga Mortgages is provided by Tembo Money Limited, who are regulated by the Financial Conduct Authority (FCA) under the registration number 952652. Their team of award-winning mortgage advisors are experienced in providing mortgage advice, including guidance on remortgaging, family supported mortgages and later life lending.