As 2025 is here, many homeowners are contemplating whether it’s the right time to remortgage. With the financial landscape continually changing, making an informed decision is tricky. Here’s our advice on what you need to know about remortgaging in 2025, along with some tips to potentially save you money in the process.
Understanding mortgages in 2025
Recent forecasts suggest a dynamic mortgage market in 2025. UK Finance anticipates an 11% increase in mortgage lending, reaching £260 billion, driven partly by a significant rise in remortgaging activity. This increase is attributed to expected improvements in affordability and potential interest rate adjustments.
The Bank of England’s base rate, currently at 4.75% is projected to decrease to around 3.5% by early 2026. This anticipated decline could lead to more favourable mortgage rates, making 2025 a fantastic time for homeowners to consider remortgaging.
Tips for Reviewing Mortgage Deals
Assess Your Current Mortgage Terms: A great place to start is by understanding your existing mortgage agreement. What is the remaining term, interest rate and are there any early repayment charges. Having this knowledge will help you determine if remortgaging is financially benefit.
Monitor Interest Rate Trends: It’s a good idea to stay informed about interest rate forecasts. If there are potential rate cuts on the horizon then timing your remortgage to coincide with these could result in significant savings.
Assess Your Current Financial Situation: Lenders assess your credit score, income and debt-to-income ratio, so it’s best to ensure your financial health is robust to qualify for competitive remortgage deals.
Speak to a Mortgage Broker: Speaking with a professional, like ourselves, can provide access to a broader range of mortgage products and personalised advice tailored to your circumstances. A broker can also guide you through the remortgage process.
How to Save Money When Remortgaging
- Don’t settle for the first offer, compare deals from various lenders to find the most competitive rates and terms.
- Decide between fixed-rate mortgages and variable rates. Your choice should match your risk tolerance and financial goals.
- Account for any arrangement, valuation or legal fees associated with remortgaging. Some lenders offer fee-free deals which can reduce upfront costs.
- Always try to negotiate better terms. Lenders may be willing to offer more favourable rates to secure your business.
Market Predictions
- Savills forecasts a 4% increase in house prices for 2025, supported by rate cuts and improved affordability.
- The Organisation of Economic Co-operation and Development (OECD) projects that UK interest rates will fall back to 3.5% by early 2026.
Our advice to you is to consider your individual circumstances and conduct thorough research and where possible seek professional advice from a mortgage broker.
By reviewing mortgage deals, understanding the market landscape and implementing cost-saving strategies, you will be able to make informed decisions that align with your financial objectives.
Get in touch with us today to schedule your FREE 30-minute consultation.
*Please note: your home maybe repossessed if you do not keep up repayments on your mortgage.