Remortgage

Also Read - Getting on the Property Ladder | Mortgage Conveyancing | Mortgage Protection

Are you a homeowner with a mortgage looking to save on your repayments by changing lenders, or do you want information on the process of remortgaging? How about a re-mortgage to release home equity?

What is a Remortgage

A remortgage means switching your mortgage to a new lender, or remortgaging could be used to free up equity on a property to create fresh finance. Most people currently pay their mortgage providers standard variable rate, and this will never be the best deal available. Potentially you could save a lot of money by switching lenders and re-mortgaging on a lower rate or for a more flexible deal. There is no reason not to look into re-mortgaging your home if it could save you money.

Remortgage Steps - The Path to Savings.

Remortgaging, just like a mortgage, can be time consuming to arrange and potentially difficult to understand. We think breaking the process down into 4 small steps should help visitors with any confusion understand remortgaging better.

Step1: Mortgage Penalties
Contact your mortgage lender and inform them that a home re-mortgage is being considered, they may offer a better deal to stay with them. Find out if there are any early redemption penalties, these are sometimes called early repayment charges. How much will you have to pay out in any redemption penalties? Hopefully there will be no redemption penalties, but these will be recouped over time. Calculate how much your current mortgage costs over 1 year, including any penalties.

Step2: Locating a New Mortgage
The next step in re-mortgaging is to find a new mortgage, you want smaller monthly repayments and extra flexibility if you require it. There are plenty of companies and web sites online that you can use, but you could be turned away if you have problem credit. Calculate how much the new mortgage costs over a 1 year period.

Step3: Remortgage Fees
Ask the new mortgage lenders if any legal, valuation or registration fees are involved in the new mortgage. Any costs involved will be recouped over time but some companies may even waive the fees as part of their marketing gimmicks. Add these fees to the new mortgage costs over the 1 year period.

Step4: Savings versus Fees
Compare the cost of your current mortgage including any fees involved, against the cost of the new mortgage including any fees. Ideally the re mortgage should save you money straight away over the 1 year period. With costs involved it may take some time to recoup this initial layout, but annually you should be looking at making a saving. It is possible that you may have to compare differences over a 2 year period before you begin to see savings but the length of time over which you are willing to wait will depend on your personal preference and your circumstances.

Remortgaging
Remortgaging, should save you money perhaps not straight away, but within a short span of time. A re-mortgage on the home is a large investment, so you should make sure to be certain before accepting and signing any paperwork on the mortgage. Once the paperwork or contracts have been signed they become legally binding.