7 Reasons To Remortgage Your House

7 Reasons To Remortgage Your House

Note: Your home may be repossessed if you do not keep up repayments on your mortgage

Having a mortgage is the biggest financial commitment most people will have. By getting the best advice and streamlining this large debt, you can save thousands per year.

1. Your home’s value has gone up

In the current market (as of writing February 2022) we have seen considerable rises in the sale prices of homes. This means that you are now probably in a lower loan-to-value band and therefore you will benefit from much lower rates. Most homeowners will be in this situation at the present time.

2. Your current mortgage is about to end.

It is advisable to start looking to remortgage around 3-6 months before your current rate ends otherwise you’ll be stuck on your lenders Standard Variable Rate (SVR). This is where the expert advice of Tricia Kennedy from the Confidential Mortgage Broker is invaluable.

3. You want to overpay & your lender won’t let you.

We often come across the scenario where a homeowner wishes to make overpayments on their mortgage. This can be because of a pay rise or that the person has inherited a sum of money. If your current mortgage won’t let you make the overpayments you wish to make then a remortgage is a great candidate, because it will allow you to reduce the size of the loan and potentially get a cheaper rate as a result. Just be aware of any early repayment charges or exit fees. Here at the Confidential Mortgage Broker, we will be able to provide expert advice and guidance on this area.

4. You want to switch from interest-only to repayment mortgage.

We work with a variety of lenders that would be happy for you to switch from an interest only to repayment mortgage. Some will even allow you to change part of the loan to capital repayment and leave some on your interest only mortgage. There are a number of reasons why this could be useful and we would be happy to discuss your individual requirements.

5. You’re looking to achieve a better rate.

Be advised that if you’re tied into an initial mortgage then you may have to pay early repayment charges. These can often be between 2-5% of your outstanding mortgage amount. Sometimes lenders even have a small exit fee. These are often referred to as ‘admin fees’ or ‘deeds release fees’. Again expert advice is crucial at this stage.

6. You want to borrow more.

Lenders will often ask why you wish to borrow extra money and it’s not unusual for people to want to remortgage. There are a variety of reasons such as building an extension to the house; buying a new car; or paying off other debts. Be prepared to tell the new lender why you want the extra money. Surprisingly, the lender is likely to be more comfortable with you borrowing the money for a new car than for business purposes.

7. You want a more flexible mortgage.

In today’s modern life, flexibility is often on the agenda. Changing jobs, going back into education, and even travelling – whatever the reason, there are mortgages which will let you take payment holidays. These additional flexible features usually come with a slightly higher interest rate.

If it sounds like remortgaging could be the right move for you, do ensure you start searching at least 12-16 weeks before you want to remortgage. Taking advice from the Confidential Mortgage Broker is an essential part to any remortgage and we would be happy to talk to you to understand your exact requirements.