Several lenders have reduced how far in advance homeowners can lock into their next mortgage deal, with some going as far as halving their transfer windows.
Many lenders allowed existing customers to secure their next mortgage deal up to six months before their current deal came to an end. That was underlined in the Mortgage Charter, which was introduced in June last year to help homeowners manager their mortgage payments.
Longer transfer windows can provide valuable peace of mind at a time when rates are rising, as they enable borrowers to ensure they’ve secured a new rate with the same lender. If mortgages rates fall prior to the new deal starting, they’d usually be able to transfer to a lower rate without penalty.
However, now that the mortgage market has stabilised in recent weeks, and many lenders have started lowering their fixed rates in anticipation of further base rate reductions, some of the biggest lenders have reduced their product transfer windows for customers staying with them.
Here, we look at which lenders have cut back their switching periods, and how this could affect you when you come to remortgage.
Lenders that have reduced their mortgage transfer windows
Nationwide Building Society was the first of the big lenders to start shortening its mortgage product transfer window between April and May this year, reducing it from 6 months to 5 months, and then to 4 months.
Santander reduced its transfer window period gradually between May and August, and like Nationwide now has a 4-month switching window for product transfers, down from 6 months earlier this year.
Halifax and BM Solutions have followed suit, reducing their product transfer switching windows from 6 to 4 months for deals maturing from 28 February 2025, and this week Barclays is cutting its switching window in half from 180 days to 90 days. By shortening their windows, lenders reduce the chances of customers re-applying for their next mortgage deal several times as rates come down.
What does this mean for your mortgage?
As a general rule, 3 or 4 months should provide plenty of time for you to get your mortgage ducks in a row and lock into your next deal. Bear in mind that lenders’ transfer windows vary, so it’s worth checking what your lender’s timeframe is so you have plenty of time to act, and to compare the rates they offer you with what’s available on the open market.
Although some of the window reductions might seem dramatic, the fact that mortgage rates are gradually easing makes it less crucial to secure your next mortgage deal so far in advance compared to when rates are rising.
If you’re worried about signing up to your next mortgage deal and rates subsequently coming down, bear in mind that securing a deal that starts in a few months’ time doesn’t mean you’re committed to it.
Our Rate Check service, for example, allows you to secure your next deal but then review rates at any time until you make the final switch to a new deal. We will perform a check of your chosen lender's rates automatically after about 4 weeks and let you know what we find.
And if things change, for example, interest rates fall before your new deal is due to start, we can even check the whole market again to see if there’s a better deal available - you just need to ask your adviser. Rate Check has saved our customers millions of pounds already this year by enabling them to take advantage of improving rates.
