With 2025 underway, many homeowners across the United Kingdom are asking themselves one important question: is now the right time to remortgage? Whether your fixed-term deal is coming to an end, you’re looking to reduce monthly payments, or you’re exploring ways to release equity, timing is everything. Interest rates, inflation, and broader economic conditions all influence this decision.
In this comprehensive guide, we’ll explore the state of the UK mortgage market in 2025, expert predictions, and what you need to consider before deciding to remortgage. If you’re contemplating your next move, Mortgage Offer Ltd is here to help you make a well-informed choice.
What’s Happening in the UK Mortgage Market in 2025?
The mortgage landscape has changed significantly over the past few years. The UK saw dramatic interest rate hikes between 2022 and 2023 in response to rising inflation. By late 2024, however, rates began to stabilise, and entering 2025, we’re seeing the first signs of meaningful reductions.
Key trends in 2025:
Interest rates are softening: After peaking in 2023, average fixed mortgage rates are now gradually declining. Some lenders are offering five-year fixed deals below 4% for the first time in nearly two years.
Increased competition among lenders: Major banks and building societies are actively competing for business, leading to more attractive remortgage deals and cashback offers.
Relaxed lending criteria: In response to market pressures, some lenders have adjusted their affordability checks, making it easier for certain homeowners to qualify for higher borrowing amounts.
Stable property values: House prices have steadied following a turbulent period, offering a more predictable environment for borrowers assessing equity release.
Why Might 2025 Be a Good Time to Remortgage?
There are several compelling reasons to consider remortgaging this year.
1. Falling Interest Rates Could Lower Monthly Payments
One of the most common motivations to remortgage is to secure a lower interest rate. With the Bank of England expected to continue cutting its base rate through 2025, fixed mortgage rates are following suit. If your current deal was taken out when rates were higher, you may now be eligible for a more competitive product, potentially reducing your monthly repayments.
2. Protection Against Future Rate Increases
While rates are trending downward, nothing is guaranteed. Locking into a low fixed-rate mortgage now could offer long-term peace of mind in the event of future economic shocks or inflation spikes. A five- or ten-year fixed product provides stability, especially valuable for those on a tight budget.
3. Your Fixed-Term May Be Ending
Many fixed-rate mortgages secured in 2020 or 2021 are reaching their end. If you fall into this category, failing to remortgage could result in being moved onto your lender’s Standard Variable Rate (SVR), which is typically much higher. Acting early allows you to avoid unnecessary cost increases.
4. Home Equity Growth
If your property has increased in value over recent years, you may now qualify for a lower loan-to-value (LTV) bracket. This can open up more favourable remortgage deals, including lower rates and fees. Even modest growth in equity can improve your negotiating position with lenders.
Considerations Before You Remortgage
While there are many advantages, it’s important to weigh the potential drawbacks and consider your personal situation carefully.
1. Early Repayment Charges (ERCs)
If you are still tied into your current mortgage deal, remortgaging early may trigger early repayment charges. These fees can sometimes outweigh the benefits of switching, so check your original mortgage terms or consult a broker to determine if it’s financially worthwhile.
2. Arrangement Fees
Some remortgage deals come with arrangement or booking fees, which can run into the hundreds or even thousands of pounds. Always factor in the total cost of switching, not just the headline interest rate.
3. Your Credit Score and Financial Profile
Lenders will assess your current income, debts, and credit history before offering a new mortgage. Any recent changes in employment status or missed payments could affect your eligibility or the rates offered.
4. Affordability Checks
Although lending criteria have loosened slightly in 2025, you will still be required to pass affordability assessments. Ensure you have all necessary documentation, including payslips, bank statements, and proof of outgoings, before applying.
What Are the Experts Saying?
Financial analysts and mortgage brokers alike are largely optimistic about 2025 as a strong year for remortgaging.
Economic confidence is gradually returning, with inflation moving closer to the Bank of England’s 2% target and interest rates forecasted to fall further throughout the year.
Lenders are becoming more aggressive in their product offerings, aiming to win back customers who delayed remortgaging during the rate hikes of previous years.
Consumer sentiment is improving, with more households feeling secure enough to make long-term financial commitments again.
According to many in the mortgage industry, acting early in the year—before any unexpected changes in monetary policy—could prove advantageous.
How Mortgage Offer Ltd Can Help
At Mortgage Offer Ltd, we understand that no two homeowners are the same. Whether you’re remortgaging to save money, fund home improvements, or simply want better peace of mind, we’re here to help you find the best product for your needs.
Our team of experienced advisers will:
Review your current mortgage and personal circumstances
Search the entire market for the most competitive deals
Offer tailored recommendations without any unnecessary jargon
Handle the application process from start to finish
We work with major high street lenders as well as specialist providers, ensuring you have access to a broad range of remortgage solutions.
Final Thoughts: Is 2025 the Year to Remortgage?
In summary, 2025 presents a promising window of opportunity for homeowners considering a remortgage. Falling rates, increased lender flexibility, and stabilising economic conditions combine to create an environment that favours proactive borrowers. However, the right decision depends on your individual circumstances, current deal, and long-term goals.
Looking to remortgage in 2025? Contact Mortgage Offer Ltd today for a free, no-obligation consultation. Your next great mortgage deal might be closer than you think.