Start by asking your existing lender
Before anything else: ask your current institution to review your rate. Many will reduce it on request, particularly where your repayment record is clean and market rates have moved.
This costs one conversation and may make the entire exercise unnecessary. We tell customers to do this first, even though it means we do not get the file.
The costs that are not in the headline
A transfer carries a processing fee at the new institution, legal and technical verification charges, a fresh valuation, and — where applicable — stamp duty or MOD charges on the new security creation. Some also carry a foreclosure charge at the outgoing institution, depending on the loan type and who the borrower is.
Added together these frequently amount to more than the first year of interest saving.
Break-even, not rate difference
The honest measure is the month at which cumulative saving exceeds total switching cost. If that month falls beyond your remaining tenure, the transfer loses you money regardless of how attractive the rate looks.
Late in a tenure, most of the interest has already been paid. A transfer at that stage rarely makes arithmetic sense.
When a transfer genuinely works
A substantial remaining tenure, a meaningful rate difference rather than a marginal one, a credit profile that has improved since the original sanction, and an existing lender unwilling to match. When those line up, the saving over the remaining term can be significant.
When they do not, we will tell you the arithmetic does not favour you.
Continue from here
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Editorial standard
Every article carries a named author, a named reviewer and a review date. We correct errors rather than quietly removing them. Published 2026-07-20; last reviewed 2026-07-20.