Remortgages
Are you considering remortgaging? If you’re looking to save money on your mortgage payments, release equity from your property, or achieve other financial goals, remortgaging can be a smart financial decision for you.
Remortgages | Mortgage Advice | Kind Financial
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Last Updated: 20th April 2023
Are you considering remortgaging? If you’re looking to save money on your mortgage payments, release equity from your property, or achieve other financial goals, remortgaging can be a smart financial decision for you.
What is a Remortgage?
A remortgage is the process of switching your mortgage to a new lender or a new mortgage product with your existing lender. This means you’ll be taking out a new mortgage on your property, which will replace your existing mortgage.
There are several reasons why you might consider remortgaging, such as to save money on your monthly payments, reduce the length of your mortgage term, release equity from your property, or consolidate your debts.
Remortgaging can also help you take advantage of lower interest rates or better mortgage deals, which can save you thousands of pounds over the life of your mortgage.
When you remortgage, you’ll typically have the option to choose between a fixed-rate mortgage, a variable-rate mortgage, or a tracker mortgage. Fixed-rate mortgages have a set interest rate for a certain period of time, while variable-rate mortgages have an interest rate that can fluctuate based on market conditions. Tracker mortgages are tied to the Bank of England’s base rate, which means your payments will rise or fall based on changes in the base rate.
When should you Remortgage?
Deciding when to remortgage can be tricky, as it depends on several factors such as your current mortgage rate, the length of your mortgage term, and your financial goals. However, there are a few situations where remortgaging might be a good option:
Your current mortgage deal is about to end: If your fixed-rate or tracker mortgage deal is coming to an end, you might want to remortgage to secure a better deal and avoid being moved onto your lender’s standard variable rate.
You want to save money on your monthly payments: If you can find a better mortgage deal with a lower interest rate, remortgaging could help you reduce your monthly payments and save money over the life of your mortgage.
You want to reduce the length of your mortgage term: If you’re looking to pay off your mortgage faster, you could remortgage to a shorter-term deal with higher monthly payments.
You want to release equity from your property: If you need to access the equity in your property, remortgaging could allow you to release some of the value of your home.
However, it’s important to note that remortgaging isn’t always the best option. If you’re on a fixed-rate mortgage and there are still a few years left on your deal, you might face early repayment charges if you remortgage too soon. Additionally, if your credit score or financial situation has changed since you took out your original mortgage, you might struggle to get a better deal when you remortgage.
How to Remortgage
If you’ve decided that remortgaging is the right option for you, the next step is to start the remortgage process. Here’s a step-by-step guide:
Check your current mortgage deal: The first thing you need to do is check your current mortgage deal and find out when it ends, how much you owe, and whether there are any early repayment charges. You’ll also need to check your credit score and make sure your finances are in good shape.
Shop around for deals: Once you know your current mortgage details, you can start shopping around for remortgage deals. At Kind Financial, we can help you compare deals from different lenders and find the best option for your needs.
Apply for a mortgage: Once you’ve found a deal you like, you’ll need to apply for a mortgage. You’ll need to provide your lender with information about your income, expenses, and credit history, as well as details about your property.
Valuation and survey: Your lender will arrange for a valuation and survey of your property to ensure it’s worth the amount you’re borrowing.
Legal process: Once your mortgage is approved, you’ll need to go through the legal process of remortgaging, which involves transferring your mortgage from your old lender to your new lender. This can take several weeks and will involve legal fees.
Switch your mortgage: Once the legal process is complete, your new mortgage will be in place, and you’ll start making payments to your new lender.
Costs and Fees of Remortgaging
Remortgaging comes with several costs and fees that you need to be aware of. These include:
- Early repayment charges: If you’re on a fixed-rate mortgage, you might face early repayment charges if you remortgage before the end of your deal.
- Valuation and survey fees: Your lender will charge you for a valuation and survey of your property.
- Legal fees: You’ll need to pay legal fees for the legal process of remortgaging.
- Arrangement fees: Some lenders charge an arrangement fee for setting up your new mortgage.
- Exit fees: Your old lender might charge you an exit fee for switching your mortgage.
It’s important to factor these costs into your decision to remortgage and ensure that the benefits outweigh the costs.
Further Guidance
Remortgaging can offer numerous benefits to homeowners, including saving money on monthly repayments, releasing equity from your property, consolidating debt, and obtaining better terms and conditions on your mortgage.
However, navigating the remortgaging process can be challenging, which is why it’s crucial to work with an experienced mortgage broker who can offer valuable advice and guidance.
If you’re considering remortgaging, we invite you to contact Kind Financial to learn more about how we can help you secure the best deal for your needs. Our team of expert mortgage brokers have the knowledge and experience to navigate the remortgaging process on your behalf, ensuring a smooth and stress-free experience. Don’t hesitate to reach out today to take the first step towards securing your financial future. Simply give us a call on 0121 796 6655 or click to send us a message.
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