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Remortgaging Before the End of a Fixed Term

Can I remortgage before my fixed term ends? Get the right advice here.

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By Pete Mugleston  | Mortgage Advisor Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 6th September 2019 *

If you’re wondering whether you can remortgage before the end of fixed term, then this article is for you.

Changing a fixed rate mortgage early could save you money but before hastily making the jump, it’s important to be aware of the potential consequences of switching without advice. 

To avoid potentially losing money when refinancing before your fixed period is up, read our tips below.

If you’d like to know whether you can you remortgage before your fixed rate ends, chat with an advisor here.

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Can you change mortgages before the fixed term ends?

A fixed rate mortgage provides a level of predictability for many homeowners as the rate they pay on their mortgage is fixed for a set period of time. This period of time is limited, often between 2-5 years (although this can vary!)

Some fixed term mortgage agreements can have restrictive terms which can make it difficult to easily leave ahead of the fixed interest period ending.

These terms may state that if you were to break the terms of your contract by leaving early, you are required to pay a penalty charge.

Depending on the fee charged by the mortgage lender, remortgaging before the end of fixed term might not always be financially beneficial.

Some lenders can charge high fees which mean that the cost of remortgaging could outweigh the money potentially saved through switching.

Can you affordably remortgage before your fixed rate is up?

Although some lenders can charge costly fees to homeowners who want to remortgage before the end of a fixed term, it may be possible to switch and save money.

To do this, you need to calculate the cost of the charges against the money you could save after remortgaging to a cheaper fixed rate elsewhere.

Initially, it might be difficult to find a lower rate that can provide a saving but with the help of a mortgage advisor who has access to the current rates and deals, this can be a lot easier.

Comparing rates can be time consuming but finding a better deal could allow you to reduce your monthly repayments or pay your mortgage off quicker.

Calculating costs can put people off, especially if they have never had to do it before but that’s where the help of a broker can be of further assistance.

Ask an advisor to calculate these costs for you here.

Top tips when remortgaging before the end of a fixed term

Most reputable experts would recommend the following...

Start researching 3 months prior to switching

Remortgaging is a huge financial decision that shouldn’t be taken lightly so it can be helpful to begin comparing remortgage deals three months before the end of your fixed term.

This can allow you time to compare the market and then carefully consider the best route for you. Think about whether you can afford to remortgage and whether the new rate could allow you to save money. 

As well as this, when researching mortgage lenders, try to not solely base your decision on cost and also look at customer reviews and complaints.  

Compare a range of lenders and rates

After a quick search online, you may find a few competitive rates by well known lenders but don’t be tempted to rush your decision.

Some lesser known lenders can also provide appealing rates and you may be able to find a lender with less restrictive eligibility requirements. If you are a borrower with affordability or credit issues, considering other lenders could be worth your time.

Consider whether interest rates could change soon

Outside influences such as Brexit or the base rate can affect the interest rates offered by lenders. Because of this, in some instances it may be worth delaying a switch until the outcome of said events is clear.

With that being said, holding off on remortgaging before your fixed term is up could also mean that you could miss out on a good deal, so ask a professional for their opinion and guidance before making a decision.

Avoid applying with multiple lenders

Working with a mortgage broker really can make the process of finding the best fixed rate remortgage deals a lot smoother and more importantly, it can help you avoid nasty credit rejections on your file.

All too often we hear of homeowners who apply to numerous lenders with the hope that one will accept their application. Unfortunately, with every remortgage application comes a credit and affordability check. The more applications for credit, the more likely that some lenders will query why you have applied to various sources.

Many homeowners are unaware that a mortgage rejection can leave a lasting mark on their credit history which could impair their chances of successfully getting a fixed rate remortgage. 

A mortgage broker who specialises in fixed rate remortgages can tell you ahead of applying whether you’re likely to be accepted. This can prevent credit rejections and can also save you money in application fees.

Ask a mortgage broker about fixed rate remortgages

If you’re still asking yourself, “can I remortgage before my fixed rate ends?” then feel free to ask one of the advisors we work with for help.

They are on hand to answer any of your questions and can explain the process of changing a fixed rate mortgage early as well as give you a breakdown of the lenders who are most likely to approve you.

Call Online Mortgage Advisor today on 0808 189 2301 or make an enquiry here.

Updated: 6th September 2019
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FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The info on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.