Should I remortgage with the same lender

Remortgaging is a financial decision that many homeowners face at the point when their current mortgage deal is coming up to its end date. One of the key considerations is whether to remortgage to another lender or stick with the same lender and select a product from their current product range. In this blog, we will delve into the factors you should weigh when deciding whether to stay with your current lender or look into the market to ensure that you get the best remortgage deals in the UK.

Understanding the Basics of Remortgaging

Before we dive into the specifics, let us refresh our understanding of what remortgaging means. Remortgaging is essentially the process of switching your existing mortgage deal, either with your current lender or a different one. This is often done to secure a better interest rate, reduce monthly payments, or release equity for other financial needs.

Should you Change your Lender?

Assessing your Current Deal –

Begin by evaluating your existing mortgage deal. Take note of the interest rate, terms, and any associated fees. Has your financial situation changed since you first took out the mortgage? If you are on a fixed-rate deal that is about to end, this is a crucial juncture to consider your options. Understand the current market rates and compare them with what your current lender is offering.

Loyalty Perks and Incentives –

Some lenders offer loyalty perks to existing customers such as reduced fees, better rates, or enhanced terms. Investigate whether your current lender provides any incentives for staying with them. Loyalty might be rewarded and in some cases, the benefits of staying with the same lender can outweigh the advantages of switching. Additionally, staying with your current lender offers a level of familiarity and convenience. You are already acquainted as a client of the lender thereby minimizing the need to provide extensive paperwork to switch on their new deal.

The Cost of Switching –

Changing lenders can come with its own set of costs. Consider the fees associated with remortgaging legal fees, valuation fee and arrangement fees with the new lender. Be sure to weigh this cost against the potential savings or better terms offered by a new lender. Sometimes, the expense of switching may outweigh the benefits.

Financial Goals and Circumstances –

Examine your current financial goals and circumstances. Have they evolved since you first secured your mortgage? If you are planning major life changes, like starting a family, pursuing further education, or changing careers, your mortgage needs may change too. Consider whether your existing mortgage aligns with your long-term goals and if a new lender might offer more flexibility.

Market Conditions and Interest Rates –

Keep a close eye on the current mortgage market conditions and interest rates. If the market rates have significantly changed since you took out your mortgage, it might be an opportunity to explore better deals. Sticking with your current lender may limit your exposure to potentially more competitive deals in the market. Exploring other options can open doors to lower interest rates.

In conclusion, deciding whether to remortgage to a different current lender or staying with your present lender by switching onto a different product is a detailed process that requires careful consideration of various factors. While the familiarity and potential cost savings may be enticing, it is equally important to explore the broader market to ensure you are securing the best possible deal for your financial circumstances. If you are still looking for more answers, you should talk to a remortgage broker in the UK. Our experts at Visionary Finance will work on your behalf to provide you with honest and impartial advice.