Product transfer mortgage
We often get contacted by clients who ask us to arrange Product Transfers for them. Or, ask whether they should remortgage with a new lender or stay with their current provider.
We'll advise you as to whether a Product Transfer is right for you, or if switching to a different lender might be more suitable in your situation.
What is a product transfer mortgage and how do they work?
A product transfer is basically switching to a new mortgage deal with your existing lender.
Product transfers don’t normally require a full valuation of the property if the amount borrowed is unchanged, and this means that they can be very quick to complete. If you’re looking to extend your borrowing with your current mortgage lender, this would be classed as a specific type of product transfer known as a further advance. These agreements usually involve more eligibility assessments, and a valuation.
Taking your lender up on their product without checking whether there’s a better deal elsewhere is not recommended.
How are product transfer mortgages different to remortgages?
They aren’t really any different, except a product transfer is specifically a new product with your current lender. Used generally, the term ‘remortgage’ can refer to refinancing with either your current lender or another one, but it wouldn’t be a product transfer if you were switching lenders.
In terms of the process involved, remortgaging with another lender can take longer than a product transfer and there may be extra steps to complete, especially if you’re borrowing extra. But with a product transfer, you’re limited to just one set of mortgage deals.
Advantages and disadvantages of a product transfer?
The table below shows the advantages and disadvantages of a product transfer versus remortgaging with another mortgage lender…
A full valuation might not be needed.
Borrowers are usually exempt from legal fees.
Your existing lender won't normally carry out further credit checks.
They can be completed quickly if interest rates are rising.
Getting the best deal is less likely as you’re limited to your current lender’s product range.
Your circumstances may have changed requiring specific mortgage advice.
Switching to a new lender might mean you get a more competitive deal.
As an existing borrower you may not get the lowest rate from your current lender.
Because there is unlikley to be a valuation, your borrowing is not based on the current value of your property.
The benefits of Using Mortgage321
Taking your mortgage lender up on a product transfer without checking what other remortgage deals are out there is not recommended. It’s strongly advised that you speak to one of our advisers and ask them to search the entire market for you to see what’s on offer.
This will open an entire market of mortgage products up to you. If the rates your current lender is offering really are the best available, we are obliged to tell you this and advise you to stick with that mortgage provider. We can still do all the work for you and you will benefit from our full advice.
Many people take their lender up on a product transfer because they think it’s the quickest and easiest way to renew their product. In reality, that may not be the case.
When you choose Mortgage321 as your mortgage broker, we will be committed to securing a competitive deal for you. Our brokers listen to what you want and tailor our service to provide it. We talk to you every step of the way, guiding you through the application process and supporting you throughout.
If you want to find out your options for a mortgage contact us to speak to one of our friendly mortgage experts.