Product Transfer Mortgage

A product transfer mortgage is when you choose not to shop around for the right deal and you select a new product, usually a fixed rate, with your existing lender. Usually, no documents are required for a product transfer and legal work is not required.

A remortgage is when you shop around for the right deal and move your existing mortgage to a new lender. Your new mortgage will repay your old one and you’ll have options such as reviewing the term and/or capital raising. You’ll need to provide evidence of income and affordability to the new mortgage lender along with legal work.

Some mortgage lenders now offer remortgage deals with cash back which usually covers the legal side. This helps keep all the costs of a remortgage to a minimum.

As part of our remortgage advice service, we’ll automatically compare both options for you, considering any fees payable to recommend the most suitable way forward.

The benefits of a product transfer mortgage are that it’s usually quick and no documents or legal work is required.

A product transfer mortgage works well if your personal situation has changed since you took out your original mortgage, for example, you’ve recently gone self-employed and do not yet have enough year’s accounts to qualify for a new mortgage at this time.

Depending on the amount of money that we can save you, we can also consider a remortgage down the line when you’re ready to proceed.

6 months before your current mortgage deal ends is the perfect time to start comparing any product transfer deals that are being offered by your existing lender to what is available on the market.

Please don’t lock into any product transfer deals without seeking mortgage advice, we’ve seen many a client make costly mistakes regarding early redemption charges here.

If we secure you a new remortgage, you can keep your eye on rates, and if they go down before your current deal ends, most mortgage lenders will let you switch over to a new deal.

The rates available on product transfer mortgages are often good, however, you can usually get a better rate by letting us, a trusted mortgage broker, shop around for you. Potentially saving you £1,000’s over the term of the mortgage.

Yes, usually it’s no different to if you were employed.

No, there are not usually any fees associated with a product transfer mortgage. However, most lenders now offer fee-free remortgage deals that have a cash back deal that usually covers the legal work. Therefore, these are very low in fees also.

Usually, this is ok, however, it’ll depend on the type of bad credit that you have. For example, if you’ve recently missed mortgage payments, you’re likely not to be offered a new deal.

If you’re looking at your remortgage with bad credit options, there may be more options for you with a more specialist lender.

Your existing mortgage lender will make it very easy for you to switch to a new deal via their internet banking portal, mobile app, or letter. As mentioned above, please be aware that there will probably be better deals available for you elsewhere.

As part of our remortgage service, we’ll compare all of your options and recommend the most suitable one for you.

You can speak with one of our mortgage brokers by clicking the button below.

No, you cannot borrow more money with a product transfer mortgage. If you’d like to increase your borrowing with your existing lender, this is called a further advance mortgage. If you’re in the middle of a fixed rate, we’ll also consider a second charge mortgage, often called a secured loan also as this may work out cheaper.

Getting a further advance with your existing mortgage lender will be a similar process to getting a remortgage to release equity elsewhere.

Whether you do a further advance mortgage, a second charge or a remortgage will depend on when your fixed rate mortgage deal ends, what interest rate you’re paying, your property value, how much you owe and your affordability etc.

If you are looking to take out additional money on your mortgage, you’d find having an experienced team, like us on your side to guide you through the process.

Your current mortgage terms and conditions will be replaced when you switch deals. Your mortgage broker will go through all these new terms and conditions with you.

Changes such as interest rates, how much you can overpay and early redemption charges etc will have likely changed.

No, it’s unlikely that you will be able to make any changes to the amount or term when doing a product transfer.

A remortgage would be a better option for you if you are looking to make any changes to your mortgage, such as extending or reducing the term.

The 7 benefits of a product transfer mortgage are:

1. They are quick, it’s a fast process.
2. No legal work is required.
3. No mortgage broker fees by us.
4. In most cases, you won’t need to pass a credit check.
5. Usually, you won’t be assessed against lending criteria like a new client.
6. Minimal or no paperwork.
7. Very little documentation is required, we’ll just need your ID.

The 7 disadvantages of a product transfer mortgage are:

1. The lenders try to get you to lock in early before you’ve taken advice.
2. An inferior interest rate, they’ll probably be cheaper deals elsewhere.
3. The term of the mortgage needs to stay the same.
4. The amount of mortgage needs to stay the same.
5. You cannot release capital for any reason.
6. The names on the mortgage stay the same, you cannot add or remove a name.
7. Any recent home improvements won’t be taken into account for your valuation therefore, you could be missing out on better loan to value deals.

Yes, this is called a remortgage. There are many advantages to doing a remortgage over a product transfer. These include shopping around for the most suitable rate, the ability to review your remortgage term if required and to add or remove a name from a mortgage.

Options such as a remortgage for home improvements or remortgage for debt consolidation might be available to you also.

Unlike with a product transfer mortgage, with a remortgage, you’ll have to provide documents, go through a credit check, and meet affordability/criteria rules from your new lender etc.

If you are approaching the end of your mortgage term and are only paying the interest back, it’s never too early to look at your options.

Interest only mortgages were popular in the 90s and 2000’s as a way of keeping the cost of your lending down. If your interest only mortgage deal is ending soon then please get in touch. Mortgage lenders have been very innovative over the last few years and have various solutions available for you.

Any early redemption penalties for paying off your mortgage in full following a product transfer will be discussed as part of our mortgage advice process. The penalties will be outlined clearly in your new mortgage offer also.

Be careful here, we’ve seen some very costly mistakes from previous clients. You need to pay attention to all the small print regarding costs, what you can and can’t do, and early redemption charges. Please always seek advice rather thank clicking online to do this yourself.

If you are looking to overpay monthly, rather than in full, most lenders will allow you to pay so much extra per month depending on their criteria. Making regular overpayments, if possible, will save you lots of interest over the term of your mortgage.

Usually, no documentation (or very little) is needed to do a product transfer mortgage application. If we do this on your behalf, we’ll only request your ID as part of the process. It’s very simple.

With a remortgage, you’ll need to provide 3 months bank statements, 3 months proof of earnings, ID, along with any ad-hoc documents that are requested along the way. However, you could save yourself a lot of money by going through this process.

We’ll help you decide as to how much your save and whether this is worth it to you.

As there is no legal work involved, a product transfer mortgage is very quick. In fact, it can be too quick and easy sometimes! A good time to start speaking to us about your mortgage options is 6 months ahead of your fixed rate deal ending. This is the time to book a free, no-obligation remortgage consultation.

A remortgage on the other hand can take around 2/3 months to complete but could result in a big saving for you financially. The 6-month mark is key here also.

We’ve never known this to happen however it’s not impossible. This will depend on whether your existing mortgage lender has stopped lending for mortgages and how good you’ve been meeting your repayments.