Why to remortgage?
By remortgaging you can take advantage of the current mortgage deals on offer, and?
You Could Save Money
Remortgaging is a great way to save money. Find out what interest rate you are paying on your current mortgage, and see if you could get a lower rate with other lenders and save money.
You Could Raise Money
Remortgaging can help you release any money locked up in your home. If you are looking to raise a bit of extra cash for home improvements, a well deserved holiday or even a new car, remortgaging may be a cost effective option. And if you can also save money by lowering your interest rate, your mortgage payments could cost less than you think.
You Could Consolidate Your Debt
Remortgaging, taking advantage of lower interest rates and borrowing a little extra can be a cost effective way to consolidate any expensive debt you may have e.g. credit and store cards or loans.
You Could Avoid Moving Home
The news is full of rising house prices, so if a new home seems out of reach, why not improve your current home? You could remortgage to raise money to add an extension ? you may increase the value of your home too!
Remortgaging is not as time consuming process as it is often portrayed. You will be required to complete a mortgage application and the lender will make a decision on your eligibility based on the same criteria as if it was a new purchase. A new lender will require a valuation to be done on your property and a solicitor will handle the legal side of the transaction. Both of these processes should be more straightforward and less time consuming than they would be in a normal purchase.
Considerations to remortgage
There are many things to consider when choosing what product you are looking for. Having had experience of the mortgage market you should be more aware than when you previously took out a mortgage. You may require certain features on your new mortgage which your existing lender didn't offer or which were not important to you at that time. Examples of these may include;
- Fixed monthly payments - consider fixed rate mortgages
- Low monthly payments - consider trackers and discount mortgages
- Flexibility - mortgages which permit overpayments and/or payment holidays
- Offset - consider CAM mortgages or products with an offset savings account
Length of mortgage product
In general the longer the period of the mortgage deal the higher the interest rate that will apply to that product. For example two year discount rate products will generally have lower interest rates than three year discount rate products. This is because the lender is making a longer term commitment to hold their interest rates for you. Depending on your view of current interest rates this may affect what length of product you opt for.