The best remortgage deals - explained by a finance expert

Wednesday, 10th June 2020, 1:48 pm
Updated Wednesday, 10th June 2020, 1:48 pm
Switching from an SVR to a new fixed rate deal could save you money on your mortgage (Photo: Shutterstock)

by Derin Clark

Homeowners currently on their mortgage lender’s standard variable rate (SVR) could save themselves a significant amount of money each month simply by switching to a new mortgage deal.

Often, it can be easy for a fixed mortgage deal to end and borrowers forget, or do not have the time, to look for a better deal and instead spend years on an SVR. But switching from an SVR to a new fixed rate deal could result in lower monthly repayments and save you money each month as a result.

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Right now, with interest rates at a historic low, the mortgage market has remained highly competitive. As well as this, many mortgage lenders are able to carry out automated valuations if social distancing issues prevent them from carrying out physical valuations, so there’s nothing to stop you looking at fixing into a new mortgage deal.

The team of mortgage experts at Moneyfacts.co.uk has looked at all the mortgage deals available as at 3 June 2020 and highlighted the best remortgage deals for homeowners. When deciding the best deals, the team looked at a range of factors including rate, product fees and incentives.

Saying this, before choosing a remortgage deal, especially if you have unique circumstances, you should consider speaking to an independent mortgage broker who will be able to advise you on the best options for your individual needs.

You can also find out exactly how much your mortgage repayments will be each month by using the mortgage repayment calculator on Moneyfacts.co.uk.

The best remortgage deals available

For those looking to remortgage at a 60% loan-to-value (LTV), TSB currently offers the best remortgage deal. It offers a rate of 1.44% (3.2% APRC) fixed until 31 August 2022, after which it reverts to 3.59% variable. This deal does not charge any product fees and comes with the incentives of free valuation and no legal fees.

HSBC is offering one of the best deals for those looking to remortgage at a slightly higher LTV of 75%. It offers 1.49% (2.9% APRC) fixed until 30 September 2025 and then reverts to 3.54% variable. This deal charges £999 in product fees and borrowers should be aware that if it is being applied for as a joint mortgage, a minimum joint earned income of £15,000 is required. It also comes with the incentives of free valuation and no legal fees.

The best deal for homeowners looking to remortgage at an 80% LTV is from TSB, which offers 1.39% (3.3% APRC) fixed until 31 August 2022, and then reverts to 3.59% variable. The product fees on this deal total £995 and it comes with the incentives of free valuation and no legal fees.

Those looking to remortgage at an 85% LTV currently have two providers offering the best deals. HSBC offers 1.95% (3.2% APRC) fixed until 30 September2023, after which it reverts to 3.54% variable. This mortgage has no product fees and has the incentives of free valuation and no legal fees. As with the other HSBC mortgage, if this deal is applied for as a joint mortgage, a minimum join earned income of £15,000 is needed.

Alternatively, mortgage borrowers looking to remortgage at 85% LTV could choose the deal from Lloyds Bank, which offers 1.84% (3.1% APRC) fixed until 31 August 2025, and then reverts to 3.59% variable. Borrowers should be aware that this mortgage offers a maximum loan of £249,999. Its product fees total £999 and it also comes with the incentives of free valuation and no legal fees.

Product data above correct as of 3 June 2020

You can find all the current deals available by visiting the remortgage chart at Moneyfacts.co.uk