All You Need to Know About Switching Your Mortgage

Switching Your Mortgage


The mortgage market is constantly changing. Your current mortgage lender would have offered your an initial deal, typically with an incentivised mortgage rate.When this deal ends your rate will revert to a lender’s Standard Variable Rate. This usually will result in higher mortgage rates and increased monthly mortgage payments. These increased mortgage costs are likely to impact your disposable income and monthly budgeting. Switching your mortgage can help reduce your mortgage costs. While switching your mortgage may seem a daunting task, it is relatively simple. Of course the result is potential savings of hundreds of pounds a month of your mortgage payments.

How does a mortgage switch work?

A typical standard mortgage has a duration of about five years. At this stage, you can renew with your current lender or choose a new one. Switching your mortgage can help you change the interest rate, payment options, and lock in a new deal in. The goal is to obtain better interest rates, reduce monthly payments or change your mortgage term length.

How does a mortgage switch benefit you?

Whilst the concept of switching mortgage rates has been around for a number of years – it is advisable to still seek independent mortgage advice. Mortgage switching can help you save money and pay your mortgage faster. Here are some of the key benefits of mortgage switching.

Lower your mortgage product interest interest rates: Lowering interest rates is one key benefit of mortgage switching. Lower interest rates will create a direct impact on mortgage payments. When you lower your mortgage costs, the goal ultimately is to increase your disposable income.

Another big advantage is that switching mortgages can help pay the mortgage off faster. Ideally with the savings made from monthly mortgage payments – ‘overpayments’ on the mortgage can be made. This will have an effect of reducing the term of your mortgage over time.

Access to better mortgage products: Switching mortgages can also provide access to better mortgage products with more favourable terms and conditions. When you first obtained your mortgage, you may have had limited options because of your credit score, income or deposit. However, if your financial situation has improved, you may qualify for more favourable mortgage products. A mortgage adviser can assist you with reviewing your circumstances.

Improved cash flow: By reducing your monthly mortgage payments, you may improve your overall cash flow and have more money available for other expenses or investments. Reduced mortgage payments can free up more money and allow you to allocate these funds towards other expenses, investments and savings.

Improved cash flow can provide financial flexibility and allow you to achieve financial goals faster.

Flexibility and Security: Most mortgage products in the UK are ‘flexible’ mortgage products with lots of options and features. It is sometimes difficult to identify what these and are as often they get lost in a mortgage lender’s terms and conditions.

Some of these features would include; overpayments, underpayments, payment holidays, offsetting and porting.

Preparing to switch mortgage providers

Switching has become relatively easy. Most lenders offer an online switching facility and this can be done over the phone or via email. A basic understanding of your financial circumstances would be required to perform the switch.

How to switch mortgage providers?

Switching mortgage providers involves a few key steps:

Research and compare mortgage providers: Contact your mortgage adviser before your current mortgage expires. They will guide through your options comparing from 100’s of available mortgage deals. Doing this yourself can be confusing with every lender using different technical terms – it can be difficult making a comparison between the available products and of course all the costs that are involved.

Are you looking to switch your mortgage and save money on your monthly payments? Visit SwitchRates to compare mortgage switch deals and find the best rates for your needs at no additional cost.

Apply for a mortgage: Swithrates have made the switching process quick and easy. Your adviser will review your mortgage options and present you with the different product options. You can discuss and agree on the best product for your circumstances – your adviser will guide you through the benefits of each product. The actual application is completely online with minimal documentation required.

Complete the mortgage process: Typically switching only takes area days and all of the new mortgage product details will be available instantly. Switching can usually take place before your nest mortgage payment is due.

All our advisers are FCA regulated and offer full transparency on any costs that are involved.