What your result means
An Early Repayment Charge is what most lenders take if you leave a fixed or discounted deal before it ends, and it can easily wipe out a year or more of the saving a lower rate offers. This calculator nets the ERC, product fee, valuation and any cashback against the monthly saving from a lower rate, so you see a single break-even month, and a true cost comparison over the whole new fixed term rather than just a monthly number that ignores the up-front charge. If the true cost over the term is lower for the new deal, switching comes out ahead in this comparison; if it is higher, staying on your current deal or its SVR would cost less over the same period, even though the new deal's headline rate looks better.
Adding the product fee to the loan instead of paying it upfront spreads its cost across the mortgage rather than out of your pocket today, but it also means you pay interest on the fee itself for the life of the new deal, which this calculator reflects by increasing the balance the new rate is applied to. Once your new deal is settled, our running cost calculator can help you keep track of the full picture.
Worked example
A holiday home owner in Cornwall has £250,000 outstanding at a 6.0% Standard Variable Rate after their previous fixed deal ended. A new lender offers 4.5% fixed for 5 years, with a £999 product fee added to the loan, a £200 valuation fee, and an Early Repayment Charge of 2% of the balance, or £5,000, since they are still inside their notice period on the SVR-linked deal. The total cost to switch is £5,000 + £200 = £5,200 (the fee is added to the loan, not paid upfront, so it is not counted as cash out the door). The monthly saving between 6.0% and 4.5% on this balance is roughly £216. Dividing £5,200 by £216 gives a break-even of about 25 months, comfortably inside the 5-year new deal. Staying on the SVR would still owe about £224,830 after 5 years; switching, with a slightly larger starting balance (the fee was added to the loan) but a lower rate, would owe about £220,522. Adding what is still owed to what was paid, the new deal's true cost comes out around £12,045 lower than staying on the SVR over the 5 years, on the figures entered. This example is illustrative; a real quote depends on the lender's exact product and your own deal's ERC schedule.
How this is calculated
Cost to switch = ERC + product fee (if paid upfront) + other fees - cashback
Break-even months = cost to switch / monthly saving
Balance left at end of term = amortised balance after the term's months, at each deal's own rate and starting balance
True cost over the term = (monthly payment x months, plus the same up-front items netted in) + balance still owed at the end
Comparing payments alone would be unfair whenever the two deals pay down the balance at different speeds - a different rate, or a different starting balance because a fee was added to the loan. This calculator adds back the balance still owed at the end of the term as a cost, so the comparison is apples to apples: total money paid, plus what is left to pay off.
A product transfer, staying with your existing lender on a new deal, usually skips a full new affordability assessment and legal work; a remortgage to a different lender involves both. Both are compared here purely on rate, fee and ERC, since approval is a separate question this tool does not assess.
| Item | Typical range | Notes |
|---|---|---|
| ERC | Often 1% to 5% of the balance, stepping down each year of the deal | Set by your own mortgage offer, not a fixed statutory rate; FCA requires it to be a reasonable pre-estimate of the lender's cost |
| Residential remortgage LTV (no extra borrowing) | Commonly up to 90% to 95% | Market practice, not a regulatory cap |
| Capital-raising remortgage LTV | Commonly around 80% to 85% | Many lenders ask the reason for the extra borrowing |
What this calculator does not cover
This tool does not check whether you would pass a new lender's affordability assessment, does not model interest-only balances or a full mortgage term beyond the fixed period you enter, and does not calculate stamp duty (see our stamp duty calculator), buy-to-let tax treatment, or the loan-to-value maximums a specific lender will actually offer, since those vary by lender and are not set by a single regulator. It also does not distinguish a product transfer from a full remortgage beyond the fee and cost inputs you give it; the legal and underwriting differences between the two are not modelled.
Questions
Where do I find my exact Early Repayment Charge?
Your original mortgage offer document sets out the ERC schedule, usually as a percentage that steps down each year of the deal. Your latest annual mortgage statement or an online account portal will usually also show the current figure.
Is adding the fee to the loan a good idea?
It reduces the cash you need on completion day, but you pay interest on the fee for as long as you hold the mortgage, so paying it upfront is cheaper in total if you can afford to.
What is the difference between a product transfer and a remortgage?
A product transfer moves you to a new deal with your existing lender, typically without a full new affordability check or legal work. A remortgage moves the loan to a new lender and usually involves a fresh valuation, legal fees and underwriting.
Does this work if I am already on my lender's SVR?
Yes. Enter the SVR as your current rate; there is usually no ERC to leave an SVR, since it is not a fixed-term deal, though check your mortgage offer to be sure.
Are the loan-to-value figures in the table a hard limit?
No. They are typical market practice reported by brokers and lenders, not a number set by the FCA or another regulator, and they vary by lender and borrower profile.
Last reviewed 15 September 2026 against FCA Handbook MCOB 12.3 and MCOB 11.9. Next review 6 April 2027.
This calculator gives a general estimate from the figures you enter. It is not financial, tax, legal or mortgage advice. Rules change and personal circumstances matter, so confirm with a qualified professional before you act. See the full disclaimer.