Can I Remortgage at Any Time?

The Short Answer

Yes, you can apply to remortgage at any time. There is no legal restriction on when you can switch your mortgage deal. However, whether it makes financial sense depends entirely on your current mortgage terms and the costs involved.

The most common barrier to remortgaging early is the early repayment charge (ERC). Most fixed-rate and tracker deals come with ERCs that apply during the introductory period. These charges can be substantial, often ranging from one to five per cent of the outstanding mortgage balance.

For example, if you have a remaining balance of £200,000 and an ERC of three per cent, you would need to pay £6,000 to leave the deal early. That is a significant cost that would need to be offset by savings on the new deal.

When Is the Best Time to Remortgage?

The ideal time to remortgage is when your current introductory deal is coming to an end. At this point, there are typically no early repayment charges, and you can switch seamlessly to a new deal before being moved onto your lender's SVR.

Most mortgage advisers recommend starting the remortgage process three to six months before your deal ends. This allows time to compare offers, submit your application, and complete the legal work without being rushed.

You may also want to consider remortgaging if interest rates have dropped significantly since you took out your current deal, if your property has increased substantially in value (improving your LTV), or if your financial circumstances have changed in a way that means you could qualify for better terms.

Remortgaging During a Fixed-Rate Period

If you are in the middle of a fixed-rate deal, remortgaging is still possible but the early repayment charge could be costly. Before proceeding, you need to work out whether the savings from a new deal outweigh the ERC and any other costs.

In some cases, it can make financial sense to pay the ERC. For example, if interest rates have fallen dramatically and you have several years left on a relatively high fixed rate, the long-term savings on the new deal might exceed the one-off charge. A mortgage broker can help you run the numbers.

It is also worth noting that some mortgage deals have ERCs that reduce over time. For example, a five-year fix might charge five per cent in year one, four per cent in year two, and so on. Waiting a few more months could significantly reduce the cost of switching.

Situations Where You Might Remortgage Early

There are several scenarios where remortgaging before your deal ends could make sense:

• A major drop in interest rates – if market rates have fallen significantly, the savings could outweigh the ERC.
• Relationship breakdown – if you need to remove a partner from the mortgage, remortgaging may be necessary.
• Significant property value increase – if your LTV has improved dramatically, you might access much better rates.
• Financial hardship – in some cases, switching to a longer term or different product could reduce your monthly payments.

Always take professional advice before paying an early repayment charge. What seems like a good deal on the surface may not work out when all the costs are factored in. Your home may be repossessed if you do not keep up repayments on your mortgage.