Evaluating Your Options in 2025

Remortgaging is a crucial financial decision that can help homeowners reduce costs, secure better interest rates, or release equity from their property. With mortgage rates fluctuating and economic conditions changing, is 2025 the right time to remortgage? Let’s explore the key factors.

Why Homeowners Are Considering Remortgaging in 2025

Many homeowners who secured fixed-rate deals in previous years are now facing the reality of higher mortgage rates as their current terms expire. With UK mortgage rates stabilising and forecasts suggesting potential reductions, remortgaging could lead to substantial savings.

Key reasons homeowners are looking to remortgage:

• Current fixed-term deals expiring: If your deal is ending in 2025, failing to act could mean moving onto your lender’s Standard Variable Rate (SVR), which is usually higher.
• Potentially lower interest rates: The Bank of England has hinted at possible rate cuts, meaning better deals could become available.
• Homeowners wanting financial stability: Locking in a new fixed rate could protect you from future increases.

Comparing Fixed-Rate vs Variable Mortgages

Choosing the right remortgage deal depends on your financial goals and risk appetite:

• Fixed-Rate Mortgages – These offer stability, keeping your monthly payments the same for a set period (typically 2, 5, or 10 years). While you won’t benefit from rate cuts, they provide financial certainty.
• Tracker or Variable Mortgages – These follow the Bank of England’s base rate, meaning your payments can fluctuate. If rates drop, your payments decrease; however, if they rise, so will your costs.

When Should You Act?

If your mortgage deal expires within six months, now is the time to start the remortgage process. Acting early allows you to:

• Lock in a competitive rate before potential increases.
• Have time to compare deals and avoid rushed decisions.
• Avoid moving to an expensive standard variable rate.

Can You Save Money by Remortgaging?

The potential savings depend on your current mortgage rate versus what’s available now. If your deal is above 5%, switching to a lower-rate mortgage could reduce your monthly payments significantly. Homeowners on standard variable rate mortgages, often around 7%, could benefit the most.

Consider These Factors Before Remortgaging

1. Early Repayment Charges (ERCs) – If you’re still in a fixed term, check for fees before switching.
2. Your Loan-to-Value Ratio (LTV) – A lower LTV (e.g., 60-80%) means access to better deals.
3. Your Credit Score – Lenders assess your creditworthiness, so ensure your finances are in good shape.
4. Additional Costs – Consider legal fees, arrangement fees, and valuation costs before switching.

Seek Professional Guidance

Navigating the remortgage market can be complex, but you don’t have to do it alone. Windsor Hill Mortgages offers expert guidance to help you make informed financial decisions. Our experienced advisers in Bath will guide you through every step.

Speak to our team today and we'll take you through your mortgage options.