Remortgaging in 2023 – should you remortgage now or wait?

1.4 million mortgage borrowers are in a fix that’ll set them back an average of £250 a month more by the end of the year. They’re coming to the end of fixed rate deals – most of which are under 2% – and face fixing at as much as 6%. It means either paying more for years – or reverting to a sky-high standard variable rate (SVR) while they wait for rates to fall.

The third wave of our savings & resilience tool, produced with Oxford Economics found that anyone wrestling with a remortgage dilemma faces a damaging blow to their financial resilience.

This article isn’t personal advice. If you’re not sure if an investment is right for you, ask for advice.

What can you do?

Those who need to remortgage this year face higher interest rates, which will wreak havoc on their finances. There’s a risk they spend their way through savings to make ends meet, or run up short-term debts. Our comparison tool forecasts their savings resilience scores will drop by an average of three percentage points.

If your fixed mortgage is expiring, you face the question of whether you should remortgage now, or join those reverting to the SVR and waiting for fixed rates to fall. This is widely expected over the coming months, and could save substantially on mortgage payments.

However, this is a gamble.

Rates are forecast to keep rising in the short term, so those SVRs will get more expensive. Variable rate mortgages are already at their highest in over a decade, with some topping 7%, and things could get even more painful.

Hang around for too long at this rate, and you could end up spending so much over the months that you wipe out any savings from fixed mortgage rates dropping.

Your decision on when to fix will depend on how important certainty is to you. But also how much of a gamble you’re prepared to take with a cornerstone of your finances.

How do your finances shape up against everyone else?

For many, getting our finances in order has never been more important. It can be helpful to see how your financial resilience stacks up.

Our comparison tool is a big piece of analysis we do every six months. It brings together swathes of official datasets, using statistical modelling to build an overarching picture of people’s financial resilience – from savings and debt to plans for retirement and investments.

It gives us an overall picture of whether we’re getting stronger or losing resilience – and reveals the gaps in our finances.

Use our comparison tool to see how you shape up. Or explore what we found in more detail.

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