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If you already have a mortgage, you may want to switch to a different mortgage or a different lender to get a better deal. This page also explains how to transfer your mortgage if you are moving home.

Reviewing your mortgage

Gone are the days when you took out a mortgage and stayed with the same mortgage deal and the same lender until it was all paid off. These days it can be worthwhile reviewing your mortgage periodically and checking that you are getting the best deal and that your mortgage suits your current circumstances.

When should I review my mortgage?

If you have come to the end of a special deal with your mortgage and will be going onto your bank's standard variable rate (SVR) you may want to switch to another mortgage. For example, you may want to switch if you were tied into a fixed or capped rate for three years and the three years are now coming to an end.

Regardless of what stage you are at in your mortgage, you should get a statement from your lender every year telling you:

• what you have paid over the year and when
• the amount of interest that was charged over the year
• the balance still owed at the date the statement was produced
• the term remaining on the mortgage
• the cost of paying off your mortgage, including any charges that you might incur
• if there are any charges for paying off your mortgage early, and if there is date when they will no longer apply.

You can use this statement to review your mortgage and, if you are thinking about changing, to compare it with other mortgages that are available.

When is changing worthwhile?

There are many different types of mortgages available with different repayment options and ways of repaying the interest. You may want the security of knowing that your payments won't go above a certain level with a fixed rate or a capped rate, or you may want the flexibility to pay extra or take payment holidays.

End of a special deal

If you are coming to the end of a special deal, you will most likely move to your lender's SVR, which can go up and down with interest rates. Consider if you can afford higher payment if interest rates go up.

A change in your personal circumstances

If your circumstances have changed, you may find that your mortgage no longer suits your needs. For example, your income may have been reduced or your family may become larger. You might want to make sure your payments won't go up or you might look for a mortgage with lower monthly repayments.

If your income has increased or you have come into some money, you may prefer a mortgage that allows you more flexibility to make extra payments without incurring a penalty.

Changing a joint mortgage

If you own the house jointly with someone else, you probably have a joint mortgage with the other owner(s). If the number of owners changes (for example, if you decide to buy a joint owner out if your relationship breaks down), then the mortgage will have to be changed as well.

Find out more about how to change a joint mortgage further down this page.

Interest only to repayment

If you have an interest only mortgage and are worried that your savings plan won't be enough to repay the capital, you may be able to switch to a repayment mortgage without having to cash in your savings plan.

Change in interest rates

If you took out a mortgage when interest rates were high and they have now come down, you may be able to switch to a mortgage which takes advantage of the lower rates and allows you ultimately to pay back less.

On the other hand, if you took out a mortgage that tracks interest rates and it looks as if rates are on their way up, you may want to tie yourself in to a mortgage with a fixed or capped rate, to ensure that your repayments don't increase beyond what you can afford.

Need some cash

If the value of your home has increased since you bought it, you may be able to release some of the equity. The equity is the difference between the amount of your mortgage and the new value. For example if your home is worth £100,000 and you took out a mortgage for £75,000, you could take out a new mortgage for £85,000 and have £10,000 to spend as you please.

It is important that you check that you can afford the repayments if you are increasing your mortgage.

Lower monthly payments

If you are having difficulty meeting your current monthly payments, it may be worthwhile seeing if you can reduce them. You may be able to do this by:

• switching to a mortgage with a lower interest rate, or
• extending the term of your mortgage (for example instead of paying it back in 25 years, pay it back in 35 years), although this will depend on how close you are to retirement age.

Can I switch to another mortgage deal?

You may be able to save money by switching to a different scheme with your existing lender. Many lenders have more competitive schemes than they did a few years ago - you won't know unless you ask.

Can I switch to another lender?

You may be able to transfer your mortgage to a lender offering more competitive deals. You are more likely to have to pay redemption fees if you do this (especially if you have only had your mortgage for a few years) but it may work out cheaper in the long run. Shop around before you decide.

Will I have to pay any penalties?

Before switching, you should check your mortgage agreement to see whether you would have to pay redemption fees. These penalty charges could be expensive (up to 4% of the outstanding amount you owe). It's also advisable to get independent financial advice before you decide to make any changes to your mortgage arrangements. However, if you want to switch to a new deal with the same lender, you may be able to negotiate over the penalties.

You may find that even if there are penalties, they may be balanced out by lower monthly payments. Do your calculations carefully.

If a lender overcharges you when you change your mortgage, it's now possible to get the money back. The Money Saving Expert website has a step-by-step guide to making a claim.

How do I go about switching my mortgage?

First of all, you need to find out from your lender whether there are any fees or penalties for paying off your mortgage early or switching to a new deal. You can then start looking at other mortgages to see whether it's worth switching. Most lenders will charge an arrangement fee, and you may also have to pay solicitor's and valuer's fees, so make sure you include these costs when working out how much you'll save.

The Which? Mortgage Guide has lots of information about switching mortgages, and also lets you compare different deals and find out how much you will save.

Can I change the term of my mortgage?

Mortgages don't have to be for 25 years. If you can afford to pay more each month, you could cut the term, and end up saving a lot of money in interest. Most lenders won't charge for shortening the term.

Alternatively, you could reduce your monthly payments by extending the term. This will give you a longer period of time to pay back your loan, so your monthly payments will be smaller.

Can I pay extra?

If you do have cash to spare, it may be better to pay off some of your mortgage than put the money in a savings account, especially when interest rates are low. However, you may want to keep enough ready cash for emergencies, such as expensive repairs. You may be able to choose to pay extra each month, or through a lump sum once a year. Check whether your lender calculates interest by the day or the month - if it's calculated monthly, paying a lump sum once a year may be a better option. You should also ask if any penalty charges will be involved.

What if I'm selling one home to buy another?

When you sell one home and buy another, you don't necessarily have to start all over again with a new 25 year mortgage term. If your lender agrees, you can simply arrange for the mortgage on the new property to have the same mortgage term end date as on your previous home. This will be particularly useful if you have an endowment or ISA mortgage. Of course, if the loan on the new property is bigger, your monthly payments will increase.

If property prices have fallen since you bought your last home, there is a risk that selling it might not make enough to pay off the amount you owe the lender. This is called being in negative equity. You can find out more about dealing with negative equity at the National Debtline website.

How do I change a joint mortgage?

If you own your home with someone else (for example, a partner, relative or friend) and the joint ownership arrangement comes to an end, it's really important to make sure that the mortgage is changed to reflect the new situation.

If you are no longer a joint owner, you have to make sure that your name is taken off the mortgage. Until the mortgage is changed, you will remain jointly liable for the mortgage debt. This means that you will still have a legal obligation to pay back the money, even if you are no longer living in the home. If you are to be the sole owner and one of the other joint owners no longer has a share in the house, they will want their name taken off the mortgage for the same reasons.

If you need to change your joint mortgage, you can either:

• cancel the existing mortgage (this is called 'discharging the mortgage') and take out a new one in the name of the new owner or owners, or
• change the existing mortgage to show the new owners only (this is called 'varying the mortgage').

Before you can do either of these things, your mortgage lender will have to agree to the changes. If you are to be the only owner, you'll have to make sure you can afford the mortgage yourself as well as considering some other factors.