Product Transfer or Remortgage — Which Is Right for You?
When your current mortgage deal ends, your lender will offer you a product transfer — a new rate on your existing mortgage with no need to move lender. It requires no legal work, no valuation and typically completes within days. It also rarely produces the best available rate. Understanding when a product transfer makes sense and when a full remortgage to a new lender is the better option is the purpose of this advice.
When a Product Transfer Makes Sense
A product transfer beats remortgaging in a limited set of circumstances. If your circumstances have changed negatively since the original mortgage — income reduction, adverse credit events, significant change in property value — a new lender may apply tougher criteria than your existing lender, who has your payment history and does not need to reassess affordability for a product transfer. In these cases, staying with the existing lender on a product transfer protects the mortgage you have rather than risking it in a new application. Additionally, if the rate difference between your lender’s retention offer and the best available market rate is smaller than 0.2%, the time and administrative cost of switching may not justify the saving.
In most other cases — stable income, clear credit, competitive market rates — the whole-of-market comparison produces a better outcome than accepting the product transfer without comparison.
| Scenario | Product Transfer | Full Remortgage | Recommendation |
|---|---|---|---|
| Income reduced since original mortgage | No reassessment | Full affordability check | Consider PT |
| Adverse credit since original | No reassessment | Credit search required | Consider PT |
| Circumstances unchanged, good credit | Lender’s rate only | Full market access | Remortgage |
| Large balance, rate difference >0.3% | Lender rate only | Best available rate | Remortgage |
| Rate difference <0.2% | Simple, instant | Legal and admin work | Consider PT |
The True Cost of Not Comparing
On a 320,000 mortgage, a 0.5% rate difference between a product transfer and the best available remortgage rate costs 1,600 per year or 8,000 over a 5-year fixed term. A 0.8% difference costs 2,560 per year or 12,800 over five years. Your lender produces the retention offer knowing you may not compare. We produce the comparison in 48 hours, at no cost, before you respond to any retention letter. If the retention offer is competitive, we confirm it and you take it. If not, we arrange the switch with free legal work and free valuation in most cases.
How a Product Transfer Works
A product transfer is arranged directly with your existing lender, typically through their online portal or by phone. No legal work, no survey, no affordability reassessment. Your mortgage balance, LTV and property value are unchanged. The new product rate applies from the day your current deal ends. The process takes days rather than weeks. The rate available is whatever your lender chooses to offer — it is not the market rate, it is the rate they believe you will accept without checking alternatives. We check alternatives first.
What We Do for Product Transfer Clients
We run the full market comparison — including your lender’s retention offer, all competitor lenders and private banking for larger balances — and give you a clear recommendation: take the product transfer, or switch to a specific lender at a specific rate. The comparison is free. If you switch on our recommendation we manage the full process. If you stay on the product transfer we confirm you have the best decision and charge nothing. Either way, no broker fee.
We run the product transfer vs remortgage comparison for Hampshire and Surrey homeowners at no cost. Call 01252 111 000 →