Product transfer vs remortgage — what's the difference?
In short. A product transfer is a new deal taken with the existing lender on the same loan, with no new legal work and minimal underwriting. A remortgage moves the loan to a different lender, requires a full affordability check and a conveyancer, but opens up the whole market. Roughly two-thirds of UK refinancers choose a product transfer (UK Finance data, 2024).
Both options reset the rate. The choice usually comes down to whether the best available deal at the existing lender is close enough to the rest of the market to justify avoiding a remortgage's extra cost and paperwork.
Last reviewed: Next review by: 2 min read
Product transfer at a glance
- Same lender, same loan amount (no extra borrowing) and same legal arrangements
- No new affordability check in most cases (the FCA's 'execution-only' transitional rules allow like-for-like switches)
- No conveyancer required
- Can typically be arranged 3–6 months before the current deal ends and switched automatically on the reversion date
- Lender's deal range only — may be cheaper or more expensive than the wider market
Remortgage at a glance
- Different lender — full application, credit and affordability check
- Conveyancer required (many lenders offer free legal/valuation packages for remortgages)
- Can include additional borrowing (capital raising) for home improvements, debt consolidation, etc.
- Whole-of-market option — can usually find the cheapest available rate
- Takes 4–8 weeks typically
When each tends to make sense
A product transfer is often the right move where the existing lender's deal is within roughly 0.10–0.20 percentage points of the best market rate, where credit or income changes might cause a remortgage application to fail, or where the borrower simply wants the simplest possible switch.
A remortgage tends to win where the rate saving covers the legal, valuation and broker fees comfortably, where the borrower wants to raise capital, where the existing lender has tightened criteria, or where the loan-to-value has dropped enough to access a much better band.
FAQ
- Will my credit score be checked for a product transfer?
- Most lenders do a soft check or no check at all on a like-for-like product transfer. Adding to the loan or extending the term usually triggers a full affordability assessment.
- Can I extend the term during a product transfer?
- Yes with most lenders, but this counts as a 'material change' that may trigger a new affordability check. Extending the term lowers monthly payments but increases total interest paid.
- Do I need a broker for either?
- No — both can be arranged direct. A whole-of-market broker can compare a product transfer offer against the rest of the market in one go and is paid by the lender, the borrower or both (the fee structure must be disclosed up front under FCA rules).