Mortgage refixing is one of those moments when it pays to slow down, review the numbers, and make sure your bank is actually offering competitive terms.

If your fixed-rate period is ending in the coming months, your bank will send you an offer with a new interest rate. It often looks straightforward: here’s your new rate, here’s your new monthly payment, please confirm.

The problem is that the bank’s first offer is not always the best one available. That’s why it makes sense to have it reviewed. In some cases, simply negotiating with your current bank can result in a lower rate. In others, it may be worth comparing offers from other lenders. And sometimes, the original offer is perfectly reasonable and there is no need to change banks at all.

What Are Mortgage Refixing and Retention?

Mortgage refixing occurs when your agreed fixed-rate period ends and the bank sets a new interest rate for the next period.

Retention refers to negotiating better terms with your existing lender. In practice, it means saying: "I'd like to stay with your bank, but I need an offer that reflects current market conditions."

Retention is often simpler than refinancing. You keep the same bank, avoid going through a completely new mortgage approval process, and usually face less paperwork. However, staying with your current lender only makes sense if the terms are fair and competitive.

How Much Difference Can a Rate Change Make?

Even a relatively small difference in interest rates can have a noticeable impact on your monthly mortgage payment.

For illustration, let's assume a mortgage balance of CZK 3,000,000 with 25 years remaining:

If your rate increases from 2% to 5%, your monthly payment could rise by approximately CZK 4,800.

If your rate increases from 3% to 5%, your monthly payment could rise by approximately CZK 3,300.

Interestingly, even if the interest rate doubles, the monthly payment does not double as well.

Why You Shouldn't Wait Until the Last Minute

Banks usually send new rate offers several months before the end of the fixed-rate period. This is the ideal time to have the offer reviewed.

With enough time available, you can:

• Compare the bank's offer with current market rates.
• Negotiate a lower rate with your lender.
• Consider the most suitable length for the next fixed-rate period.
• Prepare a refinancing application if necessary.
• Evaluate how the new payment will affect your household budget.

If everything is left until a few days before the end of the fixed-rate period, your negotiating power becomes much more limited.

When Should You Stay and When Should You Refinance?

The goal is not to change banks at any cost.

In many cases, the most practical solution is to remain with your current lender, provided the offer is competitive. Refinancing typically makes sense when the difference in terms is significant or when you want to make broader changes to your mortgage, such as:

• Extending or shortening the loan term.
• Reducing monthly payments.
• Increasing the loan amount.
• Adjusting the mortgage to reflect changes in your family or financial situation.

There is no one-size-fits-all answer. The right solution depends on factors such as:

• Your remaining mortgage balance.
• The remaining loan term.
• The value of the property.
• Your income and financial reserves.
• Your future plans.

What Should You Do in Practice?

If your bank sends you a new rate offer, don't accept it automatically.

Forward it to your financial adviser first. We'll review whether the rate is competitive, whether the proposed fixed-rate period makes sense, and whether there is room for further negotiation with the bank.

If the offer is good, we'll tell you so. If the rate is unnecessarily high, we'll recommend the next steps.

A mortgage refixing is also a good opportunity to review your property insurance, emergency savings, and overall financial plan. We often find that insurance coverage has not kept pace with rising property values in recent years, leaving homeowners underinsured.

Key Takeaways

• Your bank's first offer may not be the best available.
• Retention means negotiating a better rate with your current lender.
• Refinancing is an alternative, but not always the best solution.
• A difference in interest rates can mean thousands of crowns per month.
• The earlier you start the process, the more options you'll have.

Is Your Fixed-Rate Period Ending or Have You Already Received a New Rate Offer?

We'd be happy to review it with you.

We'll discuss your situation and help you find the most suitable solution based on your outstanding mortgage balance, income, current lending conditions, and your future plans. That way, you can be confident that the option you choose will support not only your current needs, but also your long-term financial goals.