If you’re thinking about moving to a new mortgage deal, the first thing that pops up is “how much will this cost?”. In the UK, most homeowners hit a handful of fees that can add up fast. Knowing what they are, when they apply and how to shave them off can save you a few hundred pounds – or even a thousand.
Remortgaging isn’t just about snagging a lower interest rate. Lenders charge for their time, paperwork, and the risk they take on. Some fees are fixed, others depend on the size of your loan. Below we break down the usual suspects and give you practical ways to keep the bill down.
Arrangement fee: This is the charge the new lender takes for setting up the deal. It can be a flat £0‑£999 or a percentage of the loan (usually 0.5‑1%). Some deals waive it if you meet a certain rate.
Valuation fee: The lender will want a fresh property valuation to confirm it’s worth the amount you’re borrowing. Expect £150‑£300 for a standard valuation, more if you need a full structural survey.
Legal fee: You’ll need a solicitor or licensed conveyancer to handle the paperwork. The cost ranges from £500‑£1,200 depending on complexity.
Early repayment charge (ERC): If you’re still inside the fixed‑rate term of your current mortgage, the old lender may hit you with an ERC. It’s usually a few months’ interest – calculate it before you jump.
Broker fee: If you use a mortgage broker, they might charge a fee or receive a commission from the lender. Fees can be a flat rate or a percentage of the loan.
Shop around for a lender that offers a fee‑free deal. Some high‑street banks and challenger lenders advertise “no arrangement fee” or “free valuation” – just watch the interest rate to make sure it’s still a win.
Negotiate with your current lender. If you’re an existing customer with a good payment record, they may waive the ERC or reduce the arrangement fee to keep your business.
Consider a “fee‑only” remortgage. This means you take out a new loan just to cover the cost of switching, keeping your original mortgage untouched. It works best if the new deal saves you more on interest than the fee you pay.
Do the legal work yourself if you’re comfortable. Using a conveyancer you’ve already worked with on a property purchase can cut costs, and some firms offer fixed‑price bundles for remortgages.
Finally, use a remortgage calculator to add up all the fees and compare the total cost against the interest savings. If the fee total eats up most of the interest drop, the switch isn’t worth it.
Remortgage fees may feel like a hurdle, but they’re predictable once you know what to expect. By checking each charge, negotiating where you can, and running the numbers, you’ll make a smarter decision and keep more money in your pocket.
Remortgaging can be a smart financial decision, but it's important to understand the fees involved. This article explores common costs like valuation, legal, and exit fees. It also offers tips on how to potentially minimize these expenses. Understand what to expect financially when considering remortgaging.
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