Remortgaging vs simply product switching with same lender

Sterile

So I’m about 4-5 months away from the end of my 5 year fixed term and have been contacted by my broker who organised original mortgage back in early 2021 about handling my remortgage / looking at options.

I do understand that every situation is different but have people actually made worthwhile savings by moving lenders at remortgage time? It seems like it will be a lot of hassle compared to simply doing a product transfer which would take a few moments. When I compared rates online the offerings were so similar that I’m reluctant to go through the whole remortgage procedure just to possibly save £5-10 a month or something- if that.

15 years left on mortgage (when the time comes to take a new deal) £165k left on loan, good credit, no real debts except for a few hundred on my card of day to day expenses.

I will have a meeting with my broker and talk to him but curious if anyone has remortgaged to a new lender and felt it’s been genuinely worth it. 

kimwp

Surely it will depend on the savings and how much people value their time. If it's not worth it to you, then it's not worth it to you and it doesn't really matter if it's worth it to someone else. I personally wouldn't bother with a broker for a remortgage though, I did my remortgage by looking at the mse comparison tool, then my original broker contacted me a bit later, ran the details through his tool and said that he could only save me £50 a year (a really good guy), so not worth it given I already had the first remortgage offer in play.

Sterile

Fair points but when you say you wouldn’t bother with a broker for a remortgage how did you handle all the affordability checks and paperwork and so on? You just dealt with the new lender directly?

kimwp

Sterile said:

Fair points but when you say you wouldn’t bother with a broker for a remortgage how did you handle all the affordability checks and paperwork and so on? You just dealt with the new lender directly?

It was a while ago, so I can't remember how I got in touch with them, but yes, I dealt with the lender directly. It was very straightforward, partly because I said to assume the house value was what it was when I bought it (and house prices had been rising), so they didn't bother to do a valuation. It was a few years ago (but since affordability checks were brought in) and I think it was a couple of phone calls- an initial one to ask a few questions and set up the appointment and then the actual appointment itself. I think I probably sent them three months of accounts, but I'm a bit hazy on that.

Maybe if you are self employed or doctor or if the property is unusual, it would be worth using a broker to get a better product deal. But I can't see that a broker would add much value if it's a mainstream straightforward remortgage (admittedly based on my limited experience). Providing your details to the lender is no more effort than providing them to a broker - the conversation I had with the lender's mortgage advisor was almost identical to the one I had with the broker the first time round (except that the broker went into lots of detail about the process of buying a house, provided assurance to the estate agent that I could afford the higher offer I put in etc - I'd definitely recommend him/that service for a first time buyer)

ACG

Most people tend to stick with the same lender in my experience. 
However there are exceptions, people who have certain requirements (they want products with no ERCs, or no fees etc). But also in recent years rates have jumped up, so people might also want the lowest rate possible in order to make it more affordable. 

Speak to your broker, they can compare the options and you can decide what works best.

lfc321

Also depends a lot on who your original lender was. It can be worth switching to a mainstream lender if (for whatever reason) that wasn’t an option when you took out the mortgage. 

But the savings switching between mainstream lenders are usually not that big. 

born_again

Bonus of staying with current lender is that no affordability checks are required.
So if rates compare well against a different lender. It is a much simpler way of doing things.