Remortgage to cut your monthly payments

Cut your mortgage payments with our weekly guide to the best remortgaging deals.

A bank or building society often offers introductory ‘teaser’ rates to new customers, either at a lower variable rate, or a fixed rate for an introductory period.

Once this is up, your monthly payments can rocket as your deal will likely revert to your lender’s standard variable rate (SVR) – which is usually much higher. 

Moneywise is here to search the market each week to find the most competitive deals for you, whether you’re looking to fix for a longer period or take out a variable rate product. The products on this page are our Moneywise Best Buys - our top remortgage picks.

Our example mortgage hunter is looking to remortgage on their £200,000 property, and will be looking to borrow £100,000 over 15 years – so they’re looking for a 50% loan to value (LTV) deal. Our buyer has decided to pay fees up front to avoid being charged extra interest. 

Best fixed rate remortgage deals

Moving to another mortgage provider will involve going through its application process and affordability criteria. Fixing you mortgage will protect you from future interest rate rises but you may incur fees in the process. Do your homework and make sure a new deal is worth it. 

Coventry Building Society, up to 50% LTV, 1.69%
Fixed until 30 September 2019 then reverts to SVR (currently 4.49%)

This is a 1.69% product, fixed until 30 August 2019. Monthly payments are £629, giving an annual cost of £7,402. This product comes with £500 cashback and is available up to 50% loan to value. 

NatWest, up to 60% LTV, 1.78%
Fixed until 2 October 2019 then reverts to SVR (currently 4.49%)

This mortgage is a 1.78% deal, fixed until November 2019. Monthly payments are £633, representing an annual cost of £7,413. This product also comes with £252 cashback. It is available up to 60% loan to value.

Remortgage and lock your rate

At the moment it’s still relatively cheap to fix your mortgage repayments for the longer term. The best deals are available for well under 3%. However, monthly repayments are much higher than shorter fixes, so it only makes sense if you expect rates to rise in the next few years.

HSBC, up to 60% LTV, 1.89%
Fixed until 30 September 2022 then reverts to SVR (currently 3.69%)

The rate is 1.89% - fixed until 2022. There are no fees or cashback on offer. That’ll cost £638 a month and £7,696 each year. Our buyer will revert to a standard variable rate - currently 3.69% - after this fixed period.

First Direct, up to 60% LTV, 2.49%
Fixed for 10 years then reverts to SVR (currently 3.69%)

If you're willing to lock in for 10 years then this deal from First Direct comes with a low 2.49% rate and £35 fee. The repayments will be £666 per month, or £8,013 on an annual basis.

Variable rate mortgages

If you think the Bank of England’s base rate is likely to stay the same or fall then a variable rate could be best for you. However, if these rates rise at any time you could be left out of pocket.

Coventry Building Society, up to 50% LTV, 1.39%
Variable for term

The Coventry currently offers the cheapest variable rate deal at 1.39%. Monthly repayments are £616 with fees of £999. This represents an annual cost of £7,470.

Best interest-only mortgage deals

If you’re looking for interest-only options, remember the rules are now a lot stricter and you’ll need to show a well-thought out plan for repaying the capital at the end of the mortgage. Monthly repayments are much lower than with capital repayment, but you'll pay more interest on an interest-only mortgage in the long run. 

Not every provider will lend on an interest-only basis, so if you’re looking for one it’s best to speak to a mortgage broker. Our mortgage tool can help you get a feel for the rates on offer.

Free expert mortgage advice service

  • L&C will compare, advise on and arrange the best mortgage for you from 1000's of deals
  • You'll always get advice from a qualified mortgage expert
  • Open 7 days a week including until 8pm on weekdays

Call free on 0800 073 1936 or see mortgage best buys online.

Published: 29 July 2015
Last updated: 18 July 2017

Leave a comment