Remortgages

Remortgages General - Current Deal about to Expire? - So where is the catch?

Best Fixed, Tracker and Discount Remortgage Rates

Although the market may have shrunk, many mortgage lenders are still happy to help you move from your current mortgage lender. The market is very dynamic, both in relation to the products on offer and mortgage lenders criteria. We strongly recommend you obtain suitable Advice from an Independent Mortgage Broker.

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Remortgages, General

The main difference between those products for house purchases and those aimed at clients looking to remortgage surrounds the assistance with costs a mortgage lender can offer you. Most mortgage products aimed specifically at the remortgage market come with some assistance with either the survey fees, legal costs or both. This helps keep upfront costs and any possible hassle associated with a mortgage switch to a minimum. 

Mortgage Lenders hoping to entice you into switching your mortgage to them will typically offer a basic conveyance service (take care of the legal work involved in the change) and a free valuation of your property. 

Other variations of this include:

Refunded valuation - this is where you pay for the valuation on your property and once the remortgage completes this fee is refunded to you.

Contribution towards legal costs - where available the lender will typically pay £250 towards the costs of the legal work involved in your remortgage, should you choose to use your own solicitor. 

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Current Deal about to expire, what are your options? 

Do nothing and allow the existing deal to expire and your mortgage interest rate to revert to the lender's standard variable rate. As lenders standard variable rates are often notably higher than the special offers you received when you first took out your mortgage, your mortgage payments will probably go up. So doing nothing may not seem like an option at all, however, by leaving reviewing their mortgage too late many people are taking this option by default. As a result of this inaction they spend either a short while or a long time paying more for their mortgage than they perhaps needed to. 

Ask your current lender if they are able to offer you another special offer. They may ask for another product booking fee in order to put you on a new fixed/tracker or discount rate, however, it usually works out more cost effective than doing nothing. 

Look to remortgage by switching your mortgage to another mortgage company who are offering a better deal. By searching the market or having an Independent Mortgage Broker do so on your behalf, you can often obtain better mortgage deals than those offered by your current mortgage provider. A remortgage is where you ask a new mortgage provider to lend you the money to pay off your previous mortgage provider. Once completed you have no further dealings with your previous mortgage provider and all future payments are made to the new provider. The new mortgage provider will asses your application in much the same way as when you first took out your original mortgage. They will look at your income, existing credit commitments, payment history, the amount you wish to borrow and the value of your house in making the decision as to whether you are a suitable borrower. 

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Remortgages, so where is the catch? 

The catches are fairly limited with remortgages as market forces have forced the process to become more efficient. 

If you are looking at a remortgage to a new mortgage lender, first check if your current mortgage lender is prepared to offer you a special deal. In many cases, these deals will not be as competitive as those available on the open market, but knowing what you can have from your current mortgage provider does help set a benchmark. 

The phrase there is no such thing as a free lunch may in part apply to lender's special remortgage products. Whilst most mortgage lenders help with costs on remortgage deals, the interest rates are usually marginally higher than those without such assistance. For larger mortgages (£200,000 or above), it can be more economic to take the cheaper interest rates offered on deals without such assistance and pay for your own survey/legal costs.

If you or members of your family are considering a remortgage, please feel free to contact us to talk with an Independent Financial Adviser and Mortgage Broker. We are able to provide home appointments across the whole of West Sussex - Brighton, Hove, Haywards Heath & Crawley, East Sussex, Surrey - Croydon Sutton, Reigate, Redhill,  South London - Wimbledon, Fulham, Chelsea and Hammersmith and Central London.Back to start of page

"Your home may be repossessed if you do not keep up repayments on your mortgage."