What is Remortgaging?
When you remortgage, you are simply changing your mortgage to another product, and frequently, another lender.
There are various reasons why you might considering remortgaging your home or another property you own. Many people choose to switch mortgages because it will work out cheaper for them. For example, the introductory discounted or fixed interest rate may have finished with your current lender; therefore you could potentially get a new discount rate, a new fixed rate or a lower APR, with another lender.
Reasons Why You May Choose to Remortgage
- To save some money
You may find a lower or more suitable interest rate by remortgaging.
- Debt consolidation
To make your day to day living more affordable
- Breakdown in a relationship
This tends to involve transferring a joint mortgage into a single name.
- Forming a relationship
You may want to add someone to a mortgage as they have started living in the property too.
- Home improvements and extensions
If you feel your home needs sprucing up, you may choose to remortgage to raise the funds.
- Raising deposits
You can remortgage to raise funds for sons or daughters to use as deposits or for you to use as deposits for your own buy-to-let purchases.
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Things to Consider Before Remortgaging
It is worth noting that a remortgage is not always the best option. Even if the lender you are considering switching to is offering a lower APR, you must take into consideration the facts that:
- The new lender may charge you for valuation and solicitors fees, even if you have already paid these for your mortgage with your current lender.
- If you switch mortgage remember to look at the overall repayment period. You may be able to pay less monthly, but check the final repayment date of the mortgage as well.
- You may be able to switch your mortgage deal with your current lender, avoiding any unnecessary costs. Many lenders will allow you to switch your mortgage deal reasonably frequently.
If you’re considering remortgaging and need a helping hand, speak to one of our independent mortgage advisors.
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You may have to pay an early repayment charge to your existing lender if you re-mortgage.
You may incur fees from your previous lender when remortgaging.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME.
A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME OR PROPERTY. YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE MOST FORMS OF BUY-TO-LET MORTGAGES.
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