Introduction
We helped a company director in Woking, Surrey, arrange a mortgage product transfer with Santander despite not having a full set of company accounts available.
Our customer had a mortgage split into two parts, each with different fixed-rate expiry dates. One part was approaching the end of its existing deal, while the larger balance remained subject to early repayment charges (ERCs).
We reviewed whether remortgaging to another lender would be worthwhile or whether remaining with Santander would provide a better outcome. We arranged a five-year fixed-rate product transfer on the expiring mortgage part, allowing our customer to secure a new deal without disturbing the remaining borrowing or incurring early repayment charges.
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The Scenario
Our customer was an existing homeowner and company director who held a residential mortgage with Santander.
The property in Knaphill, Woking was valued at approximately £400,000, with a total outstanding mortgage balance of around £194,000. This represented a loan-to-value (LTV) of approximately 49%.
However, the mortgage was divided into separate sub-accounts. These are individual parts of a mortgage that can have different interest rates and product expiry dates.
One sub-account, with a balance of approximately £39,000, was approaching the end of its fixed-rate period. The larger mortgage balance remained tied to an existing product with early repayment charges.
Our customer wanted to secure another fixed rate for the expiring part without paying penalties to exit the existing mortgage arrangements.
The customer was also a director of a limited company and did not yet have finalised annual accounts available. This made the prospect of applying to a new mortgage lender more complicated.
The existing mortgage was on a capital repayment basis, with approximately 31 years remaining. Our customer wanted to maintain this repayment structure and avoid upfront mortgage arrangement fees.
The Challenge
There were two main issues to consider: the early repayment charges attached to the larger mortgage sub-account and the lack of finalised company accounts.
Both affected whether moving to a different lender would be practical or financially worthwhile.
Managing a Mortgage with Multiple Sub-Accounts
Our customer’s Santander mortgage was split into separate parts, with different fixed-rate expiry dates.
The smaller balance was ready for a new mortgage deal, but the larger balance remained subject to early repayment charges.
These are fees that a lender may charge when a borrower repays or switches a mortgage product before the end of its agreed period.
Moving the entire mortgage to another lender would have triggered early repayment charges amounting to thousands of pounds on the larger sub-account.
We therefore needed to consider whether any potential savings from a new lender would outweigh these penalties.
Applying Without Finalised Company Accounts
Our customer was also a limited company director whose business accounts had not been finalised.
When assessing a self-employed mortgage application, many lenders require evidence of income through company accounts, tax calculations or other supporting financial documents.
Without finalised accounts, it can be more difficult to demonstrate income in the format a new lender requires.
Although this would not necessarily prevent every remortgage application, it created an additional consideration when assessing whether switching lenders was worthwhile.
The existing Santander mortgage presented an alternative because an eligible product transfer could be arranged without requiring a fresh assessment of our customer’s self-employed income.
What We Did
We began by reviewing the existing Santander mortgage, including the outstanding balances, product expiry dates and early repayment charge arrangements.
This was important because the mortgage had two separate parts. A decision affecting the smaller balance could have financial consequences if it required the larger mortgage to be repaid early.
We compared the potential cost of remortgaging to another lender with the option of arranging a product transfer through Santander.
Our review considered the existing early repayment charges, the available mortgage products and whether moving lenders would provide a worthwhile overall financial benefit.
We also researched Santander’s existing customer retention products, looking for a fixed-rate option that would allow the expiring sub-account to be switched without changing the remaining mortgage.
Because our customer did not have finalised limited company accounts, a new mortgage application could have required additional financial evidence that was not readily available.
Santander’s product transfer arrangements allowed the relevant mortgage part to be switched without fresh self-employed income verification or a full set of company accounts.
We obtained the relevant identification and existing mortgage account information to proceed.
Having considered the available options and costs, we recommended a product transfer with Santander rather than a full remortgage.
This allowed our customer to secure a new fixed rate on the relevant mortgage sub-account without repaying the larger balance or triggering its early repayment charges.
The Solution
We arranged a five-year fixed-rate product transfer with Santander on the mortgage sub-account approaching expiry.
The arrangement included:
| Detail | Mortgage arrangement |
| Location | Woking, Surrey |
| Lender | Santander |
| Mortgage type | Residential product transfer |
| Balance being switched | Approximately £39,000 |
| Overall mortgage LTV | Approximately 49% |
| Repayment method | Capital repayment |
| New product | Five-year fixed rate |
| Product arrangement fee | None |
The product transfer allowed our customer to retain the existing mortgage lender and avoid making a fresh application for the entire mortgage balance.
The larger Santander sub-account remained on its existing arrangement, meaning the customer did not incur the early repayment charges that would have applied had it been redeemed.
The chosen product also had no mortgage arrangement fee, helping to minimise the cost of switching the expiring part onto a new fixed rate.
Why This Solution Worked
The Santander product transfer addressed both of the main issues affecting our customer’s mortgage.
Firstly, it allowed the smaller sub-account to move onto a new fixed rate while leaving the larger mortgage balance unchanged. This avoided the early repayment charges that would have arisen from moving the entire mortgage to another lender.
Secondly, Santander’s existing customer product transfer process did not require full self-employed income underwriting or finalised company accounts for this switch.
This was particularly helpful because our customer’s business accounts were not yet available.
Rather than introducing additional underwriting requirements and significant early repayment costs, we were able to arrange a new mortgage product within the existing Santander arrangement.
The Result
Our customer successfully secured a new five-year fixed-rate product with Santander on the expiring mortgage sub-account.
The larger mortgage balance remained unchanged, avoiding thousands of pounds in potential early repayment charges.
Our customer also avoided the need for a full remortgage application and the associated difficulties of providing company accounts that had not yet been finalised.
The product transfer achieved the customer’s objective of securing a new fixed rate while keeping the existing capital repayment mortgage structure in place.
Our customer was happy with the service and the outcome. We can also assist with future mortgage reviews as the separate Santander products approach their respective expiry dates.
What This Case Shows
A mortgage with multiple sub-accounts needs careful consideration when the individual fixed-rate periods end at different times.
Although one part of a mortgage may be ready for a new deal, moving the entire borrowing to another lender could result in early repayment charges on the remaining parts.
This case also demonstrates how a product transfer can be useful for company directors who do not have finalised accounts available.
Some existing lender rate switches can be arranged without the income verification required for a new mortgage application, depending on the lender’s criteria and the customer’s circumstances.
In this case, remaining with Santander allowed our customer to secure a new fixed rate while avoiding unnecessary penalties and additional underwriting requirements.
Need Mortgage Advice as a Company Director?
If your existing mortgage deal is approaching expiry but you do not have finalised company accounts, you may still have options.
At Kerr & Watson, we provide independent, whole-of-market mortgage advice, including reviewing whether a product transfer or a remortgage would be more suitable for your circumstances.
If you are looking for mortgage advice in Woking or the surrounding Surrey area, contact Kerr & Watson to discuss your mortgage options.
