Product transfer vs remortgage: what's the difference?
A product transfer keeps you with your existing lender. A remortgage moves you to a new one. Both have their place. We tell you which is most suitable for you.
A product transfer (often shortened to PT) is when your existing lender offers you a new fixed or tracker rate without a full re-underwrite. A remortgage is when you move to a new lender entirely. PT is faster and lighter. Remortgage usually wins on price. Most clients assume PT is always cheaper because it is easier, but that is rarely true. We run both options on numbers and tell you which is most suitable for you.
Who this is for
- Your existing rate is ending and your lender has sent you a "stay with us" offer.
- Your circumstances have changed and you are not sure if you would pass new affordability checks.
- You want a fast switch with minimal paperwork and are willing to pay slightly more for it.
- You want the cheapest rate available and do not mind a full application.
What a product transfer is
A product transfer (PT) is your existing lender offering you a new rate. Your loan stays with the same lender, your term is preserved, no legal work, no new survey, no new affordability check in most cases. It is fast, it is light, and it is what your lender wants you to do because it keeps your business.
What a remortgage is
A remortgage is a full new mortgage application with a different lender. Affordability is re-tested, the property is re-valued (usually automated), legal work is required (the new lender takes a charge on the property and pays off the old one). It takes longer, costs more in fees, and almost always wins on rate.
PT versus remortgage decision matrix
The decision usually comes down to four factors: rate gap, fees, time pressure and case complexity. The cleaner the case and the bigger the loan, the more remortgage wins. The messier the case and the smaller the loan, the more PT wins. As rough thresholds, on a clean case with a loan above £150,000, a 0.2 percentage-point rate gap is typically enough to recover all-in remortgage fees within the fixed period. Below that loan size or with smaller rate gaps, PT often holds its own. We run the numbers, we do not guess.
When PT is the right call
If your circumstances have got materially worse since your original application (income drop, new debt, recent missed payments) you may not pass a fresh affordability test. PT does not require one, so it is a safer route. It is also the right call if you need a switch in days, not weeks. PT is also the answer when your property has fallen in value enough to put you into a worse LTV (loan-to-value) bracket on a fresh valuation.
When remortgage is the right call
If your case is clean and you have time, remortgage almost always saves money. The PT rate your lender offers is rarely the best they could give you, it is the rate they think you will accept without shopping around. Compare it against the open market and you usually find a meaningfully cheaper product.
Worked example, £220,000 loan at 75% LTV
Existing lender PT offer at 4.65%. Best market remortgage at 4.30%. The 0.35 percentage-point gap is roughly £770 a year of interest savings, £3,850 over a 5-year fix. Remortgage fees are typically £500 to £1,000 all-in (free legals, free valuation, modest product fee, and no Major Money Matters broker fee on a standard case). Net saving around £3,000 over the fix. PT wins on time and ease; remortgage wins on cash. We give you both numbers on a single sheet.
What we run for you
We pull your existing lender PT offer, source remortgage options across our panel at your loan-to-value, and put the all-in cost (rate, fees, legal, broker) of both side byside. You see the actual five-year cost difference. Then you decide.
Common pitfalls we see
Accepting the lender PT letter on the day it arrives because it looks easy. Comparing only headline rates and ignoring lender and legal fees. Assuming the cheapest rate also has the cheapest fees (often the opposite). Underestimating how much your case has changed since the last switch (new partner, new income shape, new credit events all matter). We surface all of these.
How Major Money Matters helps
Specific things we do for this case type. No generic platitudes.
Pull your existing PT offer
We log into your lender or work from your latest letter and pin down exactly what they are offering and on what terms.
Source the strongest available alternative
We assess your circumstances against our lender panel and identify the strongest realistic remortgage options for your loan-to-value.
Show you the all-in five-year cost
Rate is one number. The honest comparison includes lender fees, legal fees and the time cost. We give you all three.
Pick the route that fits
If your case is wobbly we recommend PT. If your case is clean we recommend the cheaper remortgage. The numbers decide, not the lender.
Frequently asked questions
Is a product transfer always cheaper than a remortgage?
No. A product transfer is faster and has lower upfront fees, but the rate is rarely the best available. On a typical residential case, a market remortgage saves more than the fee saving on PT.
Do I need to re-prove my income for a product transfer?
Usually no. Most lenders treat PT as a low-friction renewal and skip a full affordability test. A small number ask for an income confirmation. We confirm with the specific lender before recommending.
Can I borrow more on a product transfer?
Some lenders allow a "PT plus further advance" combination, where you transfer onto a new rate and borrow extra in one go. Others do not. If you need to raise capital, a full remortgage is often cleaner.
How fast is a product transfer?
Days, sometimes hours. There is no legal work, no survey, no new affordability check in most cases. The new rate kicks in the day your existing one ends.
What if my circumstances have changed for the worse?
PT is the safer route in that scenario. A fresh affordability check on a remortgage application could come back tight. PT relies on your existing arrangement so the path is shorter.
Related
Closest siblings to this scenario. Worth a read.
When should you remortgage?
Six months out is the sweet spot. We hold the rate, watch the market, and switch when it pays.
Read moreWhat are the costs of remortgaging?
Lender, legal, valuation, broker. We surface every fee up-front so the all-in number is clear.
Read moreHow soon can you remortgage before your fixed rate ends?
Six months out is the standard window. We hold the offer and re-broke if a better rate appears.
Read moreWhat our clients say
Real reviews from clients across Romford and Essex, verified on Google.
Rated 5.0 out of 5 from 92 Google reviews Read the reviews on Google
PT or remortgage, on numbers
A quick 15-minute call and we pull your existing offer, source the market alternative, and tell you which route is most suitable for you.
Named adviser, wherever possible. No call centre. We aim to return your call as quickly as we can. Mon to Fri 9am to 5pm, weekend appointments on request.