Remortgage Explained
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Remortgage explained
Remortgaging is looking at your mortgage and potentially applying for another deal, usually with a different lender. If you take a new product with your existing provider, that’s called a product transfer. We have access to a wide range of products from High Street Lenders and specialist products and these are not available direct via our lenders.
Remortgaging Frequently Asked Questions
Listen below as Hemat Natha talks all about Remortgaging.
In less than 15 minutes, you’ll know a lot more about how to remortgage.
What remortgage options are available?
It basically comes down to your circumstances and where you are in your mortgage journey.
When your mortgage rate is up for renewal, it’s time for us to ask you a series of questions so that we can determine whether it’s better to move deals or stay with your existing provider.
We’ll ask you if you need to borrow any additional money. We will want to know if you have equity in the property and if you can afford to borrow anymore. Are you planning a wedding or a honeymoon? Do you want to treat yourself to a new car, that new Tesla, or are you looking to build an extension? Instead of moving home are you looking to have some extra room or convert that garden shed into an office?
You might have thought about clearing your debts as well. You can do that, but it’s a specialist area. We’re here to ask you all those questions before you make the decision to find a new mortgage or stay with your existing provider.
Maybe you don’t want to borrow any additional money but you want to get the right rate available now. That’s simple. We’d see what your existing lender is offering you and compare it to the thousands of products out there. We always aim to advise based on the true cost. However, our advice and recommendation will depend on your individual needs and circumstances to let you know which is the right option for you.
We’ll also ask you if you want to change the method of repayment or make any adjustments to the term of your mortgage. Is it still affordable?
A final scenario where you might want to remortgage would be where you need to adjust the ownership of the property. Maybe a relationship has come to an end or you took a specialist mortgage like a Joint Borrower Sole Proprietor product – so you may want to remove some parties from the mortgage. We can do that at that time as well.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage
When is it a good time to remortgage?
If we’ve arranged a mortgage for you before, we would typically contact you 180 days before the mortgage expires. We’re recording this in October 2022, where we’ve just had a prime minister resign and mortgage rates are up and down every day. We’re getting loads of calls from people about their mortgage payments going up and whether they should fix a new rate.
But generally we will proactively contact existing customers about six months in advance to start having that conversation. We’ll ask what you want to do in the future and start assessing your options. It depends on your circumstances, if anything’s changed and we’ll take you through everything once we contact you.
When is remortgaging not a good idea?
It’s not a good idea when the deal from another provider is not the cheapest for your circumstances. We wouldn’t just move your mortgage if you don’t need to.
Or, you may have had a dip in your home value. Something called the Loan to Value is important in mortgages, and if property prices have fallen that ratio will be lower, meaning rates are potentially higher.
If you’ve got little equity in the property, or you know you unfortunately didn’t pay that parking fine and got a CCJ on your credit profile, that might prevent you from moving mortgage providers.
That’s why we ask all those questions. Getting information and assessing it is how we know what’s possible. We advise you whether it will be good or not based on your circumstances and objectives.
The last one is if we identify you are already on the most suitable rate, we can tailor our advice and recommendation to your needs.
Your home may be repossessed if you do not keep up with your mortgage repayments.
A fee for our service is charged. This is typically £495 but the exact amount will be dependent upon your circumstances and we will discuss this with you.
Speak To An Expert
It doesn’t cost anything for a chat, it’s free and we never charge a fee until we’ve got a mortgage offer. So pick up the phone and let us take it from there.
What happens if I don’t remortgage after my deal expires?
For anyone that doesn’t know, the Standard Variable Rate is the default rate that you move on to after your current deal expires. That could potentially be a lot higher than your current rate. So if you bury your head in the sand and don’t do anything about it, your mortgage payments will increase a lot.
Always get some advice beforehand. It doesn’t mean that we’re going to move your mortgage if it’s not right for you, but we’ll let you know what’s right.
How do I improve my chances of getting a good remortgage?
Like I always say, get in touch with us as early as possible. If you’re one of our existing clients, we’ll already know your circumstances and will touch base with you during your fixed rate period.
Otherwise, let us know if there are any changes in your situation and if you’re thinking of doing something like an extension. If so, get going on the planning application – because planning takes ages for home extensions.
These days, the cost of goods have increased, so you might need an extra bit of money. Talk to us as early as possible so we can look at your available options and whether you’re able to borrow more.
So you might have noticed there’s a theme here! Get in touch with us and let us work with you as early in the process as possible.
And don’t forget to keep them making those monthly payments to keep all those green ticks on your credit profile. All these things will improve your chances of a good remortgage and securing a new deal.
What fees are associated with a remortgage?
Typically if you’re moving lenders there are the standard mortgage fees. You might have an arrangement fee. Depending on the lender you’re moving to, the valuation can be free, or there may just be a small cost.
Then you’ve also got the legal costs. Now, a lot of products have free legals where the lender provides the solicitor to do the legal work to move the mortgage. Lenders are increasingly giving cash back of up to £300 cash back towards the legal costs. So, we provide an option for us to go to our approved panel and find a solicitor to fit within that cash back product, however this will depend on your circumstances.
That way, it doesn’t cost much to remortgage, depending on your circumstances. If you’re borrowing additional money or transferring ownership, there may also be a broker fee. Your advisor will confirm that. For our existing customers we don’t charge any broker fees on a remortgage.
What else should we think about when remortgaging?
Let’s say, for example, you need to borrow additional money and you’re not able to borrow that with your existing lender. You’re coming to the end of your product. But your options aren’t exhausted – we could help you take a new deal with your current provider and there’s something called second charge borrowing or a secured loan.
So you can also borrow on top of your first charge mortgage and take a second loan out on the property just for that extra bit of borrowing. That’s definitely an option.
As with everything, it will really help if you get in touch with us early. We’re the experts to understand your circumstances and take you through the process. I’ll say it again – good old advice. That’s what we’re here for. We’ll let you know what we think is going to be the right option for you.
You may have to pay an early repayment charge to your existing lender if you remortgage.
Think carefully before securing other debts against your home.
Your home may be repossessed if you do not keep up repayments on your mortgage.
A fee for our service is charged. This is typically £495 but the exact amount will be dependent upon your circumstances and we will discuss this with you.
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