Remortgaging entails changing your mortgage to a different deal. It can be with the same lender or with a new lender. People remortgage to get a better interest rate, to reduce monthly payments or to shorten the time it will take to pay back the loan. Remortgaging is also a way to borrow additional money for home improvements or to pay off other debts.
- Research the market early and well
- Look at alternative lenders
- Get an accurate property valuation
- Be mindful of early repayment charges
- Ensure your remaining mortgage is big enough to justify the fees
Start discussing options well ahead of the time you plan to remortgage your property. Ideally, speak with a mortgage broker 3 to 6 months in advance so that you can apply for your new deal and secure a competitive rate. If your existing mortgage rate is fixed and is due to expire, try to get your new deal in place before the rate rolls onto a standard variable rate. You can use our remortgage comparison tool to find the best deals instantly.
You don’t have to stick with your existing lender! Your current lender may not have the best rates and in the current competitive mortgage market, it is often worth moving to a new lender. If your earnings have increased since you initially arranged your mortgage, other lenders may now have more options for you. If however, your earnings have decreased, then it may be harder to move to a new lender. Speak with your current lender first and then compare remortgage deals to what you are being offered.
It is important to get your property valued properly rather than try to guess how much it is worth. Without it, you will not know how much a new mortgage offer will save you. If your property value has increased since you took out your existing mortgage, you will be seen as a less risky borrower and could see your interest rate drop and more deals open up to you. Read our guide to finding out how much your property is worth.
Remortgaging might not be a viable option financially if you are leaving your existing mortgage deal early and face an early repayment fee. Do your sums carefully to assess whether it is worth remortgaging.
If your existing mortgage debt is small, then the fees incurred with switching lenders could make a remortgage financially impractical. Seek advice to help work out whether you will be better of remortgaging or sticking with your current deal. Visit www.propillo.com now for free, impartial advice.
In summary, remortgaging can save you money if your existing mortgage deal is no longer competitive and it can also be an affordable way for you to access money for a specific project. Ensure you do your research well, however, and take advice from a mortgage broker to ensure you have considered all the relevant costs involved. Compare the best remortgage deals for free now!
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