Reducing LTV within same mortgage (to get a better rate)

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Say you are on 85% LTV with a borrowing rate of 4% but 6 months or a year later, you could reduce that to 60% LTV which would attract a 2% interest rate, essentially halving your borrowing costs.

Now the straightforward (but costly for the banks) thing to do would be for the client to pay for a revaluation and the bank to then reduce the rate.

In reality, what options are there to do this aside from a complete remortgage ?

Senior_Paper_Monitor

New mortgage - pay early redemptions fees (and most, if not all, new mortgage fees).

glosoli

You could ask the bank to carry out a revaluation of the property, when this comes back make an application for a 60% product and incur any early redemption penalties which may be associated with it.

The ERC's are normally designed so this isn't an economical option, so you would have to work out the cost of the valuation, the ERC, and the product arrangement fee and see if you save more money than staying on your current deal