Reviewing your mortgage: What happens when your mortgage term ends?
When you take a residential or buy to let mortgage, in most cases you secure a preferential rate for an initial period.
That may be 2 years, 3 years, 5 years or more.
As an existing borrower with your mortgage lender you will reach a point when your preferential rate ends. So what happens when this mortgage term ends?
When your mortgage term ends, your mortgage contract will be set up to roll onto the lenders standard variable rate (revert rate). This revert rate will typically be a much higher rate than your original preferential rate (perhaps 4.24%).
This means it is important to conduct a mortgage review and explore your options going forward.
Why use our free mortgage review service?
- We consider mortgage options available to you across the whole of the market (including those offered by your current Lender).
This means you can be confident you have done all you can to secure the perfect product.
- We handle everything for you to make the mortgage review process as easy as possible, including securing a new rate with your current Lender if more appropriate.
- We have access to exclusive mortgage rates.
- We can answer any queries you have about your mortgage and your options without your needing to refer to your current Lender.
What are my options when my mortgage term ends?
Mortgage Review Option 1
Select a new preferential mortgage rate from those available from your Lender.
Your existing Lender in most cases will allow you to switch to a new preferential mortgage rate without underwriting.
- No credit searches
- No proving income
Just looking at rates offered by your current lender means you may not have the best rate available to you
Mortgage Review Option 2
Search the whole of the market to find the most suitable rate for you going forward.
Searching the whole of the market means you can be confident that you have the best available mortgage rate going forward.
Switching Lender will mean new underwriting is required. However, if circumstances mean you are unlikely to be accepted by a new Lender you still have the option of the rate offered by your current Lender.
When should I conduct a mortgage review?
A good time to review your mortgage is 3 to 4 months before your existing rate ends.
(It is possible to set up new arrangements in a few weeks if you are running a little late)
What if I miss my mortgage review point?
If you have missed a mortgage review you are probably already on your Lenders standard variable rate.
The sooner you review in these circumstances, the less painful it will be for your wallet.
What if I wish to make some changes to my mortgage?
When your mortgage term ends it is a good time to make changes such as pay off a lump sum, or borrow extra, or change the term of your mortgage.
We can help you understand to best way to manage any of these changes.
What if I intend to move?
When your mortgage term ends is a good time to consider moving as you will be free to select a new Lender from across the market if appropriate for you.
If your intention to move does not coincide with the end of your mortgage product term most residential mortgage have a portability option.
Porting a mortgage
Porting a mortgage allows you to move your mortgage product to a new property should you move home.
It does not guarantee that your current lender will offer you lending on your new property as full underwriting is still required. It does allow you to take your mortgage rate and apply it to your new mortgage without paying an early repayment penalty.
Can I swap my mortgage rate before the end of its term?
Yes, you can swap your mortgage rate before the end of its term but it is normally not in your best interests to do so because of early repayment charges.
Early Repayment Charges
Most preferential mortgage rates carry an early repayment charge for the term of the deal. Typically 3 to 5%, these charges are levied should you exit your product before the standard end date of the deal.
Current mortgage retention rates for existing borrowers offered by major Lenders
- Accord Product Transfers
- Barclays Switch Rates
- BM Solutions Product Transfers
- Halifax Product Transfers
- NatWest Mortgage Switch Deals
- Scottish Widows Bank Mortgage
- Nationwide Existing Borrower Rate Switch Product Transfer
- The Mortgage Works Existing Customers
- Virgin Money Mortgage Deals Existing Customers