Remortgage Savings Calculator 2026

How remortgage savings are calculated

The calculator compares your current monthly repayment against the new monthly repayment using the annuity formula for capital repayment mortgages. The monthly saving is multiplied by the number of remaining months in your term to give gross savings. The arrangement fee and early repayment charge are then deducted to arrive at your net saving.

The break-even point is calculated by dividing total fees by the monthly saving — for example, if fees total £1,500 and you save £150 per month, break-even is 10 months. A break-even under 6 months is excellent; over 24 months suggests you should consider whether remortgaging now makes sense.

Standard variable rate vs fixed rate

When a fixed-rate deal ends, borrowers typically revert to the lender's standard variable rate (SVR). SVRs in the UK typically sit 3–5% above the Bank of England base rate and are set at the lender's discretion. As of 2026, many SVRs are in the 7–8% range. Switching from an SVR to a new 2 or 5-year fixed deal at 4–5% can save hundreds of pounds per month on a typical mortgage. Even accounting for arrangement fees, the savings are usually substantial within just a few months.

Frequently asked questions

When should I remortgage?

The best time to remortgage is typically two to three months before your current fixed-rate deal ends, to avoid falling onto the lender's standard variable rate (SVR), which is usually significantly higher. If you are already on an SVR, remortgaging can deliver immediate monthly savings. You can also remortgage mid-deal if a better rate is available — though you will need to weigh savings against any early repayment charges.

What is an early repayment charge?

An early repayment charge (ERC) is a fee your lender charges if you repay your mortgage — or switch to a new deal — before your current fixed or tracker rate period ends. ERCs are typically expressed as a percentage of the outstanding balance (e.g. 2–5%) and decrease as you get closer to the end of your deal. Our calculator lets you enter the ERC as a pound amount so you can see whether savings justify the cost.

How do I calculate remortgage savings?

Remortgage savings are calculated by comparing your current monthly repayment (using the annuity formula with your existing rate) against the new monthly repayment at the lower rate. The monthly difference, multiplied by the number of remaining months, gives gross savings. Subtracting the arrangement fee and any early repayment charge gives your net saving. Dividing total fees by the monthly saving gives the break-even point in months.

What fees are involved in remortgaging?

The main fees are the arrangement fee (also called a product fee) charged by the new lender — typically £500 to £1,500, sometimes added to the loan — and any early repayment charge on your existing deal. You may also face a valuation fee (£0–£500, often waived as a product incentive), legal fees (£200–£500, also often covered by the lender), and a broker fee if you use an adviser. Our calculator covers the two largest costs: the ERC and arrangement fee.

Can I remortgage to release equity?

Yes. A further advance or equity release remortgage allows you to borrow additional funds against your property — for example, to fund home improvements or consolidate debts. You would remortgage to a higher loan amount, which increases your monthly repayments but gives you a lump sum. Lenders will reassess affordability and the new LTV. This is separate from a straight rate-switch remortgage and should be discussed with a mortgage adviser.

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