Should I Remortgage?

If you have a mortgage then you may often wonder whether it is a good idea to switch to a different mortgage provider. You may like the one you are with or have been with them a long time, so you may feel loyal to them. However, it is worth checking out a few things to see whether it might be a good idea to switch to a different provider.

Interest Rate

The interest rate is the thing that we tend to look at when we are comparing mortgages and it is important. It shows how much interest we will be paying on the money that we owe. The higher the interest rate, the more money we will have to pay. This means that we will often look for the smallest interest rate to pick the cheapest lender. However, it is worth remembering that although interest rates are important there are other things that we should consider as well.

For example, how long will the loan last? Different mortgage lenders may offer different terms. If you are repaying over a longer time, then you will owe the money for longer and therefore pay more interest overall. It is also worth noting that some will have a fixed rate of interest which means that it will stay the same for a particular time period and then may move onto a variable rate, which could potentially be high. With these, you may be tied in as well, which means that if there are other cheaper rates available, you will not be able to move to these. Therefore you do need to look beyond the interest rate and check what else is going on as well.

Charges and Fees

You will also find that some mortgages will have fees charged as well as the interest. These tend not to be regular, but there may be admin fees when you switch over. The big one to look out for an early redemption fee, which is a charge you will pay if you decide to pay the mortgage off early. Some lenders do not have them at all but others could charge massive amounts of money so if you are interested in making overpayments or repaying early then you need to bear this in mind.

You also need to check the late payment fees. If you miss or are late with a monthly payment then there will be a charge for this. Check what these are. Even if you feel that you will always make the payments on time, it is wise to check and see what it will cost if you do not. This will allow you to compare different lenders in a different way, so if their interest rates are similar, this could be a way to decide which you think is best. Also being aware of that fee may help you be more motivated to make sure that you repay the loan on time.


It is also worth thinking about value for money. You might want to choose a mortgage provider that has a good reputation, provides good customer service, that you have heard of, has a local branch, provides online banking, that you have used before or something else. Think about the factors that might be important to you so that you can check and see whether the mortgage lenders you are considering fit in with the criteria that you feel is important. This may not be as important as the cost of the mortgage but it could make a difference and if rates are close, then it could be these sorts of things which you find will make the difference and help you to make the right choice.

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