Case Study: Residential Product Transfer in Fleet

Introduction

We helped two homeowners in Fleet, Hampshire, secure a new fixed-rate mortgage with Barclays as their existing deal was approaching its expiry date.

Our customers wanted to ensure they were getting good value from their next mortgage deal. Although they were happy to remain with Barclays, they wanted us to compare the cost of a product transfer against remortgaging to a different lender.

After completing a whole-of-market comparison, we established that staying with Barclays was the most cost-effective option for their circumstances. We arranged a two-year fixed-rate product transfer with no arrangement fee, allowing them to secure a new rate without the additional costs associated with changing lenders.

The Scenario

Our customers owned their residential property in Fleet and had an existing repayment mortgage with Barclays.

Their fixed-rate deal was coming to an end, so they approached Kerr & Watson to review their mortgage options.

The property had substantial equity, with the outstanding mortgage representing approximately 45% of its value. Both applicants were employed, with stable income and no credit issues affecting their mortgage options.

The existing mortgage balance was approximately £250,000, with 20 years remaining on the repayment term.

Their main priorities were to:

• Secure a competitive new mortgage rate.
• Compare remaining with Barclays against moving to another lender.
• Keep upfront costs and overall mortgage costs as low as possible.
• Fix their monthly mortgage payments for two years.
• Retain their existing repayment term.

Our customers preferred a two-year fixed rate because it provided payment certainty while allowing them to review their options again at the end of the initial period.

The Challenge

The main challenge was establishing whether a product transfer with Barclays or a remortgage to a different lender would provide the lowest overall cost.

Our customers had a relatively low loan-to-value (LTV), meaning they had substantial equity compared with their outstanding mortgage balance.

While this gave them access to a range of mortgage options, it was still important to compare the full cost of each deal rather than looking at interest rates alone.

Comparing the true cost of remortgaging

A lender offering a lower interest rate does not necessarily provide the cheapest mortgage overall.

Moving to a different lender can involve additional costs, including mortgage arrangement fees, legal fees and potentially mortgage advice fees.

These costs can outweigh the savings from a slightly lower interest rate, particularly over a relatively short fixed-rate period.

Managing the existing mortgage expiry

We also needed to consider when the existing Barclays deal would end.

Switching products at the wrong time could potentially result in early repayment charges, making the new arrangement unnecessarily expensive.

Our customers wanted their new fixed rate to align with the end of their existing deal.

What We Did

We carried out a whole-of-market mortgage review to establish whether our customers would be better off remaining with Barclays or remortgaging to another lender.

Our research included two-year and five-year fixed-rate mortgages, alongside variable and tracker rate alternatives.

We assessed the available options against our customers’ preference for a two-year fixed rate and their desire to minimise upfront expenditure.

Comparing Barclays against other mortgage lenders

We reviewed Barclays’ existing customer product transfer rates and compared them with available remortgage products from other lenders.

Rather than focusing solely on the advertised interest rate, we considered:

• The mortgage interest payable during the initial deal period.
• Any arrangement or product fees.
• Legal and other costs associated with moving lenders.
• Relevant mortgage advice fees.
• The overall cost of each option during the initial fixed-rate period.

This allowed us to provide a clearer comparison of the financial implications of staying with Barclays versus moving elsewhere.

Our research established that a Barclays product transfer offered the most cost-effective solution for these customers.

Arranging the product transfer

We contacted Barclays and its business development manager ahead of placing the case to discuss the proposed mortgage arrangement.

We also completed the required customer identification and documentation checks before progressing.

Once we had identified the most suitable product, we arranged the transfer with Barclays.

We considered the expiry of the existing mortgage deal to ensure the new product was aligned appropriately and unnecessary early repayment charges could be avoided.

We also committed to monitoring available rates before the new deal took effect, so that any potential reductions could be considered.

The Solution

We recommended that our customers remain with Barclays and arrange a product transfer rather than remortgage to a new lender.

The agreed mortgage arrangement was:

The product transfer allowed our customers to remain with their existing lender while securing a new two-year fixed rate.

Importantly, the selected Barclays product carried no arrangement fee, helping reduce the overall cost of the mortgage.

The existing repayment structure and term were also maintained.

Why This Solution Worked

The Barclays product transfer was suitable because it addressed our customers’ two main priorities: securing fixed monthly payments and keeping overall costs down.

Our comparison showed that changing lenders would not provide a sufficient financial advantage once the additional costs were considered.

Remaining with Barclays also avoided the legal process normally associated with moving a mortgage to a different lender.

The two-year fixed rate offered the payment stability our customers wanted, while the absence of a product fee kept their upfront expenditure lower.

By aligning the new arrangement with their existing deal’s expiry, we also addressed the potential issue of early repayment charges.

The Result

Our customers successfully secured a new two-year fixed-rate mortgage deal with Barclays.

The product transfer achieved their main objectives:

• A new fixed-rate mortgage without changing lenders.
• No mortgage product arrangement fee.
• No unnecessary legal costs associated with a full remortgage.
• Their existing 20-year repayment term maintained.
• An opportunity to review their mortgage options again after the two-year fixed period.

We also established an ongoing advice relationship to help our customers review their mortgage when their next fixed-rate period approaches and revisit their protection requirements.

What This Case Shows

This is a good example of why comparing a product transfer against a remortgage is worthwhile, even where a customer has straightforward circumstances and substantial equity in their home.

A lower advertised mortgage rate does not always translate into the lowest overall borrowing cost.

In this instance, comparing lender fees and the costs of switching demonstrated that remaining with Barclays was more financially beneficial than moving to a different lender.

For homeowners approaching the end of their mortgage deal, reviewing both options can help avoid paying unnecessary fees.

Looking to Review Your Mortgage Rate?

If your current mortgage deal is coming to an end, Kerr & Watson can help you compare the options available through your existing lender with alternative deals across the wider market.

Whether you are considering a mortgage product transfer or remortgaging to another lender, we can assess the overall costs and explain which option is most suitable for your circumstances.

We provide independent, whole-of-market mortgage advice in Fleet and throughout Hampshire.

Contact Kerr & Watson to discuss your mortgage options.