There are a number of reasons you might want to remortgage. Perhaps you want to take advantage of low interest rates and get a better deal on your mortgage. Or maybe you’re looking for a shorter or longer term mortgage. Whatever your reasons, now might be a good time to remortgage, although there are some points to think about.
You may have to pay an early repayment charge to your existing lender if you remortgage.
Remortgage is the process of switching your mortgage to a new lender in order to get a better deal.
When it comes to remortgaging, there are plenty of reasons why you might want to do it. The most common one is that your current mortgage deal is coming to an end, and if you don’t remortgage before that happens, you’ll revert to your lender’s standard variable rate. This can cause your monthly repayments to increase, so many homeowners choose to remortgage before that happens.
Another reason is if you want a better interest rate. If you’re currently on a fixed rate mortgage, the interest rate will revert to the lender’s standard variable rate when your mortgage period ends – and this can be quite a jump in payments. So, if you can find a better deal with another lender, it could be worth considering remortgaging.
Similarly, if the value of your house has increased since you took out your current mortgage, you may be able to borrow more money from a new lender. This could be a good option if you need to make some home improvements or if you want to consolidate your debts.
Finally, some homeowners choose to remortgage to overpay their mortgage. If you can’t overpay your mortgage with your current lender, it might be worth considering remortgaging with a new one that offers this facility.
Generally, it would help if you started looking into remortgaging three months before your current mortgage deal expires, and this will give you enough time to research different options and secure a new deal.
Remember that remortgaging can take up to eight weeks, so it’s best to get started early. You don’t want to be stuck without a mortgage when your current deal expires.
When remortgaging, it’s always a good idea to consult with an expert. We can help you find the best deal for your needs and situation.
When it comes time to remortgage, it’s important to be as prepared as possible. This means ensuring that your credit score is in good shape and that you have all the necessary documentation.
If you are a contractor or self-employed, you will need to do some extra work to prepare. Lenders will often want to see evidence of multiple years’ worth of business accounts and tax returns. If you have this information ready when you start looking, it can help speed up the process.
It’s also important to make sure there are no errors on your credit report. Check for mistakes and contact the credit agency if you find any. Too many hard searches in a short space of time can temporarily reduce your score, so avoid making lots of applications just before you remortgage.
Being prepared can make the remortgaging process a lot easier and quicker.
When the value of your home has decreased since you bought it; if you find yourself in this situation, it’s better to sit tight and keep paying your mortgage until property prices increase again.
Just as when you first applied for a mortgage, you’ll need to prove your income when you want to remortgage. If your earnings have decreased, so will the amount you can borrow, preventing you from switching to a new product with your existing lender.
If your lender charges an exit fee for leaving your mortgage early it can make sense to hold off remortgaging until your fixed rate ends.
There are a few things extra things to keep in mind. Make sure you compare interest rates from different lenders. You might also want to consider how much you can afford to borrow and how long you want to take out the loan.
If you’re thinking about remortgaging, the best thing is to speak to one of our brokers. As applying independently to lots of different lenders can negatively impact your credit score, which can make it difficult in the future.
We’re here to help you through the process of finding a new mortgage, no matter what stage you’re at! Give us call.
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.
Expert Mortgages is a trading name of Expert Mortgages Herts & Cambs Ltd which is an appointed representative of Mortgage Advice Bureau Limited and Mortgage Advice Bureau (Derby) Limited which are authorised and regulated by the Financial Conduct Authority.
Expert Mortgages Herts & Cambs Ltd. Registered Office Address: Hardcastle Burton, Market Hill, Royston, United Kingdom, SG8 9JN. Registered in England Number: 13095386.
