Remortgage
Optimise your mortgage terms
Remortgage is the process of replacing your current mortgage with a new one,
usually with a different lender, without moving home. This allows you to benefit
from better terms such as a lower interest rate or more favourable borrowing
conditions.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Why consider remortgaging?
- Reduce monthly payments: Switching to a lower interest rate can decrease your monthly costs.
- Fix your rate: If you expect interest rates to rise, locking in your current rate can protect you from future increases.
- Change mortgage terms: Opportunity to adjust the loan term or switch mortgage types, for example, from a variable to a fixed rate.
- Release equity: Use the increased value of your property to access extra funds for home improvements or other major expenses.
How does remortgaging work?
- Review your current mortgage: Check your existing mortgage terms,
including any early repayment penalties. - Compare new offers: Look at available mortgage products from various
lenders or consult a mortgage broker for advice. - Apply for a new mortgage: Submit your application to the chosen
lender. - Property valuation: The new lender may require a valuation of your
property to assess its current market value. - Legal process: Engage a solicitor or conveyancer to handle the
paperwork and finalise the transaction. - Complete the remortgage: Once approved, the new lender pays off
your existing mortgage, and you start repayments under the new
agreement.
Important points to consider:
- Timing: It’s recommended to start remortgaging 3–6 months before your current deal ends to avoid reverting to the usually higher standard variable rate. (Source: MoneySavingExpert.com)
- Costs: Be aware of potential additional expenses such as arrangement fees, valuation fees, and legal costs.
- Credit history: Maintain a good credit record, as it affects your ability to secure favourable new mortgage terms.