A re-mortgage simply means changing your mortgage from one lender to another, you may want to do this for a number of reasons but the most common reason is to get a better rate of interest when your current fixed rate or tracker rates expires.
It is quite common for clients to re-mortgage at the end of a special rate their current lender has offered as you will usually end up on what is known as the Standard Variable Rate, which usually means your mortgage payments will increase. For example, as at March 2015, the average standard variable rate is 4.49% but depending on circumstances you could switch to another lender and obtain a rate starting at 1.49%, as you can see that could be a substantial saving in your pocket each month.
Other common reasons for switching lenders is to raise capital for a number of reasons which generally include debt consolidation and buying a property to let out. other legal reasons are permitted as well except using the cash for your business or gambling.
How does a re-mortgage work?
Firstly, you need to speak with one of our adviser, give them a call on 01233 512012 or submit a quick question.
Once an adviser has gathered information about your personal circumstances such as your income, expenditure and new mortgage requirements a recommendation will be made, once you have accepted the recommendation the following process will take place.
- Mortgage application submitted to the chosen lender.
- We gather supporting documents, check they will be be suitable, certify and send to the underwriter for assessment.
- The lender may wish to do a survey on your property, if they do a surveyor will contact you directly to make an appointment to come and see your property.
- Once the valuation report has been received and all documents accepted a mortgage offer will be issued.
- Solicitors will be instructed for you who will act for the new lender.
- Once the solicitors have completed their checks they will arrange for the transfer of the mortgage to take place and send you any surplus money.
Of course it’s a little more detailed than this but that is where we really help with guidance and management every step of the way.
How much does a re-mortgage cost?
As you can expect there are fees involved in the re-mortgage process, your adviser will be able to detail these as they do vary and will depend on your personal circumstances, however you can expect in most cases that the new lender will cover the cost of the legal work and the valuation, some re-mortgages can be a completely fees free re-mortgage.
For more information or to get a quote call on of our professional and experienced Mortgage Advisers on 01233 512012