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What is a Remortgage?

Put simply, a remortgage is a mortgage that you take out on a property you already own. You may or may not already have a mortgage on the property in question.

Reasons to Remortgage

There are many reasons to remortgage your property, some of the more common ones are listed below although this is by no means an exhaustive list. Please get in touch if there is something else you wish to discuss as the lenders will usually accept a reason as long as it is legal and for the benefit of the owner.

Renewing your deal

Most mortgages have a mortgage product with a set end date, whether it be a fixed rate or a tracker deal. Once that deal expires you will move onto your lender’s Standard Variable Rate (SVR) which in most cases will be a considerably higher interest rate than you were previously enjoying.

Your current lender will usually send you a letter shortly before your product expires letting you know you are about to move onto SVR. They may also give you a choice of new deals that they can move you onto if you stay with them.

It is important to note that many lenders offer much better deals to new customers than they offer to existing customers. This means in many cases you can get a much better deal by moving to a new lender instead of just signing up for a new deal with your current lender.

As we are a Whole-of-Market broker we are able to compare all the deals on the market at any one time to make sure you get the best possible rate for your mortgage.

Many lenders also give us access to cheaper “Exclusive” products which are not offered to the general public. As we do much of the lender’s work for them they can afford to give us discounted deals which we can then pass on to our customers. Get in touch today to see how much we can save you!

Capital Raising

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Mortgages can be a very cheap way of borrowing as the interest rates are generally much lower than unsecured loans and credit cards. Most lenders will allow you to raise money for “any legal reason” although there are some exceptions such as for gambling purposes or to prop-up a failing business. Contact us today to check how much you can raise! Here are a few examples of why you might want to remortgage your property to raise capital:

Debt Consolidation

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If you are struggling to keep up with your payments on loans, credit cards, store cards etc. then you may benefit from consolidating them into your mortgage. This means raising enough money with your remortgage to pay off your other debts. This could dramatically reduce your monthly outgoings, in some cases by hundreds of pounds each month. Our record is over £1000 per month saved for one client.

This can be a powerful method of reorganising and simplifying your finances as you will then only have one monthly payment to contend with instead of juggling many payments. The reduction in outgoings results from paying a lower interest rate and/or spreading the payments over a longer period.

Although you may end up paying more interest over time due to spreading the repayments over a longer period, if you are on the verge of being unable to keep up with your payments this could be preferable to defaulting on your loans, thereby ruining your credit record.

If you are a homeowner and worried about keeping up with your loan payments or credit card debt please don’t delay and get in touch today. You may be surprised at what we can do for you!

Switching from Interest Only

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Do you currently have an Interest Only residential mortgage? If you are worried that you have nothing in place to allow you to repay the balance at the end of the term it is important that you take action straight away.

Every lender has a maximum age so your current age will determine your maximum mortgage term. If you want to switch your mortgage to a Repayment basis then the new lender will assess your affordability for the new mortgage over the term applied for. The longer the term you can apply for, the more likely it is to be viewed as affordable.

Every year that goes by reduces the likelihood that you will be able to switch to Repayment so don’t delay, get in touch today!

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