What is a remortgage?
A remortgage is when you switch your existing mortgage to another lender, or you negotiate another deal with your existing one.
Why should I remortgage?
Whether you should remortgage or not will depend on your individual circumstances and needs. If you have found a lower interest rate and it’s financially the better option then it might be more suitable for you to remortgage. You also might want to remortgage for the following reasons:
- You’re on a standard variable rate and want to move onto a fixed rate deal so you can be certain of your monthly repayments
- To release equity in your home if it has gone up in value
- To fund home improvements
- Your current deal is about to end
- You want to borrow more money
- You want to switch from interest only to repayment mortgage.
- You have found a lower interest rate
- Your home’s value has gone up
- You’re wary of interest rates going up
When should I remortgage?
You can remortgage at any time, however it may not always be the right time. You may want to consider:
- When your current fixed rate mortgage deal ends
- When you can save money by remortgaging, even after paying arrangement and exit fees.
- When you own enough equity in your current property.
When shouldn’t I remortgage?
When weighing up whether to remortgage, you need to consider money, timing and your personal circumstances, as well as the following scenarios:
- If your current mortgage deal is better than any other mortgage product on the market
- If you have a very high early repayment charge and it would be cheaper to wait until the end of the incentive period
- If you own 10% or less of the property as you may find it difficult to get a good new mortgage deal.
Where can I get a remortgage from?
You can apply for a remortgage from either your current lender if they’re offering a better deal, or another lender.
You can remortgage with a bank or another financial institution such as a credit union, building society or specialist mortgage lender.
How much could I borrow?
How much you can borrow will depend on your individual circumstances and the amount of equity and deposit you have. If you speak to one of our advisers they will be able to assess your situation and find out how much you can borrow based on your current situation.
Will I be credit checked?
Just like with your current mortgage, you will be credit checked by your lender once you submit your application.
Where can I find out my credit rating?
You can find out your credit rating through Experian and Equifax who are credit referencing agencies and will send you a valid credit report.
What costs are involved in remortgaging?
The costs involved in remortgaging will depend upon your individual circumstances. Possible costs to look out for are:
- Early repayment charge to your existing lender
- An exit fee to your existing lender
- Mortgage fees to your new lender
- A valuation fee to your new lender
- Conveyancing fee to your solicitor
- Mortgage adviser fee
Because we play by the book we want to tell you that…
Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.