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When you are on a fixed rate mortgage, it will usually come to an end after either two years or five years. They can also be three, seven, or ten years as well. What should you do then? What happens if you don’t remortgage?

When your fixed rate mortgage ends, it usually means that your lower rate has come to an end and you will need to remortgage. After the fixed rate ends, your mortgage will move to your lender’s standard variable rate (SVR). This rate isn’t fixed and can change at any time going up and down, typically when the Bank of England changes the base rate.

Standard Variable Rate

The standard variable rate is normally higher than the rate they have given for the fixed rate period. When you move onto standard variable rate, the early repayment charges on your mortgage also end. This means that you can end your current mortgage and get a completely new one without paying any penalty fees. It also means you can get a mortgage, almost exactly the same as your current one, but with a new low rate on a new fixed rate period for another two or five years.

How does remortgaging work?

If you remortgage, onto a new low rate fixed mortgage you will never need to pay the higher standard variable rate and therefore not have to pay more than you need to. It is completely legitimate to do this and is called remortgaging and lenders expect for you to do this.

Resolve Financial Solutions, are here to help you with remortgaging and ultimately helping you to save money. The best thing to do is to contact us before your fixed rate ends, potentially six months before your rate ends so that we have plenty of time to help you find another mortgage.

As mortgage advisers, we can find you the best deal for you to switch to and can help you switch the mortgage for you. We’ve also written a blog to help you find the best mortgage advisers near you.

Remortgaging can be repeated over and over again until you have paid off your mortgage, staying on a low interest rate for the length of your mortgage.

When remortgaging might not be the answer:

  • If you’ve got a low mortgage amount, then you may end up paying slightly more in fees than you save by switching to a new deal.
  • If you are planning to move house soon you may want to briefly go into your SVR so you don’t have to pay any early repayment charges moving to another mortgage on your new house.
  • If you are planning on making a large overpayment, you may want to do this while you are on SVR to avoid charges.

For more information about remortgaging or to speak to us about your current mortgage deal and how we can find you a new one, please get in touch.

*Please note: Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.

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