When remortgaging, you’re not moving to a new house. You are securing a new mortgage against the property you currently own. There’s no need to switch lenders when remortgaging, although you can if you choose to.
It works by paying off one mortgage with the proceeds acquired from a new mortgage deal, whilst using the same property as security. The greater your equity and the lower your Loan to Value (LTV), the rates you will qualify for will be much more competitive.
Homeowners look to remortgage for many reasons (Top 7 Reasons to Remortgage), often to reduce the overall amount of their monthly mortgage payments or interest rates. It could be to fix your mortgage rate, to avoid future inflation. Others want to pay off a mortgage sooner, whilst some people opt to raise capital to consolidate other debts or begin new ventures.
The most popular time to remortgage is as soon as the fixed rate on your current mortgage deal comes to an end. This is because after your current deal has expired, you may be moved on to your lenders Standard Variable Rate (SVR) which tend to have higher rates than that of a new mortgage deal. However, it’s not uncommon to remortgage your home before this occurs, as a way of securing a better mortgage rate.
Each individual’s circumstances will be different. Therefore, each mortgage product will be different. Often, remortgage deals are tailored to each person’s needs, property and financial situation, so it’s best to seek further advice from qualified personal before taking action.
As we’ve discovered it’s about sourcing a new deal or rate for a mortgage on an existing property. One way of looking at it is to refer to it as refinancing instead. Remortgaging could potentially save you money by securing a better interest rate or free up large amounts of cash to invest in redeveloping your home. Although, you will still need to make sure you can afford to make the repayments under the new deal and undergo a financial check before you can remortgage your home. That’s where we come in. Our industry experts are best placed to offer free and friendly advice to help you secure the best deal. Visit our Remortgages page or speak to an advisor today!
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Representative Example: Annual Interest rate of 2.44% fixed for 2 Years followed by 3.59% for the remaining term. Representative 3.50% APRC Variable. Based on borrowing of 150,000 over 17 years repayments of £899 per month. Total amount repayable £198,466. Includes Lender Fee of £995 and Broker Fee of £695.