If you’re looking into remortgaging a house you’ll probably have a few questions before you get started. What is remortgaging a house? or flat? What is the process of remortgaging? Where can I get it done? etc, etc.
Let’s take a look at some of the options available to anyone seriously interested in remortgaging a house.
The Basics – What Is Remortgaging a House?
When you are remortgaging a house you have two options, before you get into the finer details. You can choose to get a new deal with your existing lender or you can switch lenders altogether. In either case, the new mortgage rate completely replaces the old one, in an ideal world starting at the point the old rate finishes.
When Can I Remortgage?
It’s a common misconception that you need to wait until your current deal comes to an end. However, you can legitimately start the process up to six months beforehand.
There’s also the option of remortgaging at any other time of your agreement. However, you might find yourself on the receiving end of an early repayment charge in this instance. We will help you do the maths to see if remortgaging earlier is an attractive option in this case. Your new deal might be so attractive that any additional early repayment charge is financially justifiable.
Homeowners choose to remortgage their property for a variety of reasons. If the value of your property has increased and you have paid off a chunk of the amount you borrowed, you could be in a good position to negotiate a more favourable deal. Even if this isn’t the case, you should be able to secure a new mortgage deal that can offer lower monthly payments or one that will allow you to release money from the equity you have accrued.
Many homeowners use this as an opportunity to carry out home improvements, with the released equity; alternatively some prefer to clear other outstanding debts. You may even wish to purchase another property as an investment, using the released funds as a deposit.
Your financial advisor will be able to talk you through the options available, and guide you to make the best decision for your individual circumstances.
How Long Does It Take?
So, what is the process of remortgaging? Remortgaging a house is all about getting the best deal on your repayments and length of loan. Your mortgage advisor can do the hard work of sourcing the best deal for you. The process takes between 4 – 6 weeks on average, providing there are no hiccups along the way. Ideally however we should start to look at options for you as long as 6 months before the current scheme ends.
Getting professional assistance from a mortgage specialist will help speed up the process, and they will be able to make sure you are getting the best available deal. Having made a decision about what new rate to take we will then review options with you frequently to make sure it still remains the best option, right up until completion. That way if a better rate becomes available we can secure it for you instead. In practice whilst this sounds like a lot of time needs to be invested our follow up appointments can be a short as 5 minutes on a monthly basis (or longer as you feel necessary of course!).
To help ensure the process runs smoothly you should make sure your paperwork is all up to date, with addresses, employment details and financial information all in order. You risk experiencing delays if lenders and credit reference agencies can’t verify your information.
We are living in an ever changing economic environment, where cost of living and disposable income are not as stable as we would like. Knowing what the future looks like, from a financial point of view, is one thing you can have some control over, especially with timely planning.
Speak to a seasoned professional about your current mortgage situation, and see if they can help ease the strain on your financial situation.