Remortgage Calculator

Quick answer

When a fixed deal ends you roll onto the lender's standard variable rate (SVR), typically 2 to 3 percentage points higher. On a £150,000 balance over 20 years, drifting from a 4.5% fix to a 7.5% SVR costs about £259 more every month. Remortgaging before the rollover is usually the single biggest money move of the year.

Use the remortgage calculator

Enter your outstanding balance, your current interest rate and the years left to run, then the new rate you are weighing up. The tool above returns your current monthly payment, the new monthly payment, the monthly difference and the total saving across the remaining term. Change the new rate to test a few deals and you will quickly see which ones genuinely move the needle.

What remortgaging actually means

Remortgaging is switching the loan secured against your home to a new deal, either with your existing lender (a product transfer) or by moving to a different lender entirely. You are not buying a new house and you are not borrowing the deposit again. You are replacing the interest rate on the debt you already owe, usually because your current fixed or discounted period is ending and you are about to roll onto a standard variable rate (SVR) that is typically far higher.

Most UK fixed deals last two or five years. When that period ends, lenders quietly move you onto their SVR, which can be several percentage points above the best available rates. That single jump is why so many people remortgage: not to release cash, but to stop overpaying. A remortgage calculator gives you the number that matters before you commit to anything.

How remortgage savings are calculated

The maths behind the comparison is the standard repayment mortgage formula, run twice, then subtracted. For a capital-and-interest mortgage the monthly payment is:

Monthly payment = P × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1)

Where P is the outstanding balance, r is the monthly interest rate (the annual rate divided by 12, expressed as a decimal) and n is the number of monthly payments left (years remaining × 12). The calculator works out that payment using your current rate, then again using the new rate, over the same remaining term so you are comparing like with like.

The headline figures are then simple subtractions:

• Monthly saving = current monthly payment − new monthly payment
• Total saving over the term = monthly saving × number of months remaining

One important honesty check: keeping the same remaining term matters. If you remortgage and reset the clock back to 25 years, your monthly payment will fall simply because you have spread the debt over longer, not because the new rate is better. That looks like a saving but you may pay more interest overall. This calculator holds the term fixed so the difference you see is the rate doing the work, not the calendar.

Remortgaging is a market-driven decision, not a fixed government rate, so there is no official HMRC number behind it. The rate you are offered depends on your loan-to-value, your credit profile and what lenders are pricing that week. The Bank of England base rate influences the trend, but your actual deal is set by the lender.

Remortgage calculator worked example

Take Priya, a homeowner in Leeds. Her two-year fix is ending and she is about to roll onto her lender's SVR. Her details:

• Outstanding balance: £180,000
• Current rate (SVR she is about to land on): 7.5%
• New rate offered: 4.5%
• Years remaining: 20 (240 monthly payments)

Current payment at 7.5%: monthly rate is 0.075 ÷ 12 = 0.00625. Run through the formula over 240 months and the payment is roughly £1,450 a month.

New payment at 4.5%: monthly rate is 0.045 ÷ 12 = 0.00375. Over the same 240 months that comes to roughly £1,139 a month.

Monthly saving: £1,450 − £1,139 = about £311 a month.

Saving over the remaining term: £311 × 240 = roughly £74,600 in lower payments, assuming both rates held for the full 20 years (they would not, but it shows the scale of staying on an SVR versus acting).

Now a smaller, more typical case. Tom and Sara have £120,000 left over 18 years. Their fix at 3.9% is ending and the best new deal they can get is 5.2% because rates have risen. Here remortgaging makes their payment go up, from about £760 to about £835 a month. The calculator still helps: it tells them the damage in advance so they can budget, shop around for a lower rate, or check whether a product transfer with their current lender beats the open market.

Early repayment charges and fees: the saving killers

The monthly saving is only half the picture. Before you switch, three costs can eat into it:

• Early Repayment Charge (ERC): if you leave a fixed deal before it ends, lenders usually charge a percentage of the balance, often 1% to 5%, falling as the deal runs down. On a £180,000 balance a 2% ERC is £3,600. That alone can wipe out a year of savings, which is why most people remortgage exactly when their deal ends, not before.
• Arrangement and product fees: the new deal may carry a fee of anywhere up to around £1,000-£2,000. A lower rate with a big fee can be worse than a slightly higher rate with no fee, especially on smaller balances.
• Valuation, legal and broker costs: many remortgage deals bundle free valuation and legals, but not all. Check before assuming.

A useful rule of thumb: take your monthly saving, multiply by the months left on the new deal (say 24 for a two-year fix), and compare that to the total of ERC plus fees. If the saving clears the costs comfortably, switching stacks up. If it is close, the hassle may not be worth it.

An illustrative comparison

The table below shows how the monthly payment changes with the rate on a fixed £200,000 balance over 25 years. These are illustrative figures to show the shape of the saving, not quotes.

Each one-percentage-point drop on a £200,000 balance is worth well over £100 a month, which is why even a modest rate improvement is usually worth checking. For guidance on what counts as a good deal, the independent MoneyHelper guide to remortgaging walks through the wider decision.

When remortgaging is worth it

Switching tends to pay off in a few clear situations:

• Your fixed or discounted deal is ending. This is the classic trigger. Line up a new deal so it completes the day your current rate expires, avoiding even a single month on the SVR.
• Your loan-to-value has dropped. If your home has risen in value or you have paid down the balance, you may have crossed into a lower LTV band (for example below 75% or 60%), which unlocks sharper rates. Check where you sit with a loan-to-value calculator before you apply.
• You want certainty. Moving from a variable rate to a fix protects you from further base-rate rises, even if the headline rate is similar.
• You want to overpay or restructure. A remortgage is a natural moment to reduce the term or set up regular overpayments. Test the impact with a mortgage overpayment calculator first.

It is often not worth it if you have a small balance left (the fee can outweigh the saving), if a hefty ERC still applies, or if your circumstances have changed in a way that would shrink the deals you qualify for, such as a recent drop in income or a new adverse credit marker.

Common mistakes to avoid

• Comparing rate to rate instead of cost to cost. A 4.2% deal with a £1,499 fee can cost more over two years than a 4.4% fee-free deal on a smaller balance. Always add the fees in.
• Resetting the term without noticing. Stretching a 17-year balance back to 25 years lowers the monthly payment but adds years of interest. Keep the remaining term the same when you compare, then decide deliberately if you want to change it.
• Letting the deal lapse onto the SVR. Even one or two months on a standard variable rate can cost hundreds. Start arranging the new deal three to six months before your current one ends; offers are usually valid for that long.
• Forgetting the ERC window. Remortgaging a few weeks early to grab a rate can trigger a four-figure charge. Check the exact date your ERC drops to zero.
• Assuming your own lender is offering the best. A product transfer is convenient and skips affordability checks, but it is not automatically the cheapest. Compare it against the open market.
• Ignoring affordability changes. If you are now self-employed, on lower hours, or have taken on other debt, a new lender will reassess you. Do not assume the rates you see advertised are the rates you will be offered.

Property tax does not usually come into a straightforward remortgage of your own home, but if you are adding or removing a name on the deeds, or buying out a partner, stamp duty or its regional equivalent can apply. The rules differ across the UK: Stamp Duty Land Tax in England and Northern Ireland, Land and Buildings Transaction Tax in Scotland, and Land Transaction Tax in Wales. Take advice if a transfer of ownership is part of your remortgage.

These figures are estimates for guidance only and not personal tax or financial advice. Your actual rate, fees and eligibility depend on your circumstances and the lender's assessment.

Related calculators

To plan the wider picture, work out your full payment with the mortgage calculator, check the monthly figure on any deal with the mortgage repayment calculator, and see how clearing the balance faster compares using the mortgage overpayment calculator.

If you're moving quickly or buying before a sale completes, a bridging loan can be a short-term alternative to a standard remortgage.

The cost of doing nothing (£150,000 over 20 years)

Factor in fees (arrangement, legal, valuation) with the true cost over the deal period, not just the headline rate. Guidance: MoneyHelper remortgaging. Check affordability with the affordability calculator and your loan-to-value.