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Remortgages - What You Need To Know

Taking out a mortgage or buying a home is such an exciting time, but it does come with responsibility. As time goes on circumstances change and you may not be getting the most from your existing mortgage. That is why you might be thinking about remortgaging. 

Finding a suitable remortgage rate and completing the application process can be challenging without the guidance of an expert broker. However, when done correctly, it can be very beneficial.

Why Should I Remortgage?

A remortgage is when you apply for a new mortgage for a property which is already yours. This mortgage will replace the existing one or can help you borrow money against your property. 

Remortgaging is a suitable option when:

  • Your current mortgage deal or discounted mortgage rate is about to end
  • You want a better rate than your current rate
  • The value of your home has increased by a significant amount
  • Your lender does not allow you to overpay
  • The interest rates are predicted to rise, and you want to avoid paying the new ones
  • You wish to move from an interest only rate to a repayment mortgage
  • You want or need to borrow more money.

Improve Your Chances of Getting the Right Remortgaging Deal

Some tips to boost your chances of getting better deals include:

  • Start the remortgaging process at least three months before your current deal ends. Speaking to your mortgage adviser or broker earlier will give them time to search for the better rates and products most suited to your existing circumstances
  • Check your credit score, close any unused credit cards, avoid payday loans and overdrafts, and ensure to keep up with monthly outgoings
  • Do not remortgage during the initial incentive period of your current mortgage to avoid extra fees
  • Estimate the current value of your property before applying for a remortgage

A specialised broker will be able to tell you all about the tips to secure the most convenient remortgage rates. A remortgage broker can give an overview of the mortgage market and often have exclusive deals with lenders.

What Remortgage Lender Should You Choose?

Remaining with your existing lender but picking a different mortgage rate is called “product transfer” and it is an option. This strategy saves you money on legal fees and having a relationship built with your lender is beneficial. It can give you access to more deals and mean that you do not need to undergo credit checks before remortgaging. 

You may however decide upon moving your mortgage to a new lender. This choice can give you the chance to repay a chunk of your property’s value without considering early repayment fees.

What Fees Will There Be To Remortgage?

The fees that you will have to pay to remortgage will be personal to you and your situation. That is why an expert broker can help to guide and estimate how much you will have to pay. 

Generally, fees include:

  • Arrangement fees
  • Legal fees
  • Valuation fees
  • Early repayment charges (ERCs)
  • Exit fees

How Can a Remortgage Broker Help?

Finding the most convenient remortgaging deals can be challenging. An experienced remortgage broker can help save you time and money whilst ensuring you understand the process. Mortgage Brokers and Financial Advisers also take your circumstances into account when picking the right deal for you. Some brokers already have relationships built with mortgage lenders and can also sometimes offer ‘broker exclusive deals’.