How a product transfer actually works
3–6 months before your current product expires, you log in to your lender's app or website (or your broker does on your behalf), select a new product from the lender's PT range, sign the offer electronically, and your new rate kicks in the day after your old rate expires. There's no valuation visit, no solicitor instructed, no fresh income verification, and typically no credit check. Most PTs complete in 7–14 days from selection.
The honest cost comparison
Worked example. £180,000 mortgage with 22 years remaining, currently on 2.5% fix ending in 4 months:
- Existing lender PT 5-year fix: 4.55%. Monthly payment £1,151. Zero costs.
- Competing lender full remortgage 5-year fix: 4.35%. Monthly payment £1,131. Legal fees £600 (most include free conveyancing), valuation free, broker fee £0 (fee-free broker).
- 5-year saving from competing lender: £20/month × 60 = £1,200 saved minus £0 cost = £1,200 net.
- Add hassle factor (3 weeks vs 8–10 weeks process), the PT may still win for many borrowers.
On a larger £400,000 mortgage, the same 0.20% gap = £45/month = £2,700 over 5 years — large enough that full remortgaging is clearly worth the effort.
When PT wins
- Modest loan size (£100k–£150k). Rate gap saves £100–£400 over 5 years — not worth the friction.
- Recent income change (job loss, drop, maternity leave). PT skips re-affordability; new lender would scrutinise.
- Recent credit event. PT skips credit check; new lender would catch it.
- Property has structural issues or non-standard construction. PT skips valuation; new lender's surveyor might down-value or decline.
- You want to complete fast. 1–3 weeks vs 8–12 weeks.
- Existing lender's PT rate is competitive. Some lenders (Halifax, Nationwide) price PT very close to new-money rates as a retention strategy.
When full remortgaging wins
- Large loan size (£250k+). Small rate gap multiplies into meaningful savings.
- You want to raise additional capital. New lenders often more flexible than existing lender on capital raise purpose.
- You want to extend or shorten the term significantly. Easier with a new application.
- You want a different product structure. Switch repayment to interest-only or vice versa, change to offset, change product term length.
- Your existing lender's range is uncompetitive. Some lenders deliberately offer poor PT pricing knowing inertia will keep customers anyway.
- Your circumstances have improved. Higher income, better credit, paid down balance — new lender may offer better LTV pricing.
Lender PT ranges — how to assess yours
- Halifax — competitive PT range, often within 0.05% of new-money.
- Nationwide — strong PT pricing for existing customers; loyalty discount on some products.
- Santander — PT range usually 0.10%–0.20% above new-money.
- NatWest / RBS — PT range similar to new-money; flexible product options.
- HSBC — PT range tighter than new-money; sometimes only one or two products.
- Barclays — broad PT range; usually competitive.
- Building societies (Coventry, Yorkshire, Skipton) — PT often as competitive as new-money to retain mutual members.
Timing strategy — the 6-month window
- Month -6: Pull your latest mortgage statement, note the exact reversion date.
- Month -5: Request your existing lender's PT range; compare against best-buy rates from competing lenders via a broker.
- Month -4: Decide PT or remortgage. If PT: lock the new product (most lenders allow 4–6 month forward lock). If full remortgage: start application now.
- Month -2 to -3: If full remortgage, expect valuation and offer in this window.
- Month 0: Old rate expires, new rate kicks in. PT is automatic; full remortgage completes via solicitor.
Raising additional capital alongside a PT
Most lenders allow additional borrowing alongside a PT — called a 'further advance with rate switch'. This adds full underwriting: credit check, affordability assessment, valuation, evidence of purpose. The new money sits on a separate sub-account at a different (usually higher) rate. Useful when you want extra borrowing without losing the convenience of staying with the existing lender.
What if my lender's PT rates look poor?
This is a sign to remortgage. Some lenders deliberately price PTs poorly knowing many customers won't shop the market. If your lender's PT range is 0.30%+ above competing rates and your loan is £200k+, full remortgaging almost certainly wins financially. Get a broker comparison before committing to a PT.
Pros
- Fast — 1–3 weeks vs 8–12 weeks for full remortgage.
- No valuation, legal work or affordability re-test (like-for-like).
- No credit check on most PTs.
- Useful when circumstances have worsened since original mortgage.
- Avoids stress of new lender application process.
Cons
- PT rates often 0.05%–0.20% higher than best-buy new-money.
- Limited product range — only what your lender offers.
- No incentive cashback (most new-money deals include free legal/valuation).
- Inertia bias means many borrowers PT when they should remortgage.
- Some lenders deliberately price PTs poorly to extract retention margin.