If your current mortgage no longer suits you, there’s no need to feel tied to your lender. Remortgaging can help you save money if a different lender is offering a better deal than you can get with your current lender.
What is remortgaging?
Remortgaging is taking out a new mortgage deal on a property you already own, using your new loan to pay off the old one. You might do this because you’re no longer satisfied with your current mortgage deal but wish to keep your property, or because you wish to borrow additional money using your property as security.
How much could I borrow if I remortgage?
This will depend on your income and affordability. Our advisers can help you weigh up your options, taking these factors into account.
Why would I remortgage?
Some reasons why you may want to consider remortgaging could include:
- You’re coming to the end of your existing deal
– Many fixed-rate mortgages are typically between 2-5 years, after which your lender will automatically put you on an SVR (standard variable rate). This will likely be higher than your previous interest rate and uncompetitive, so remortgaging can prevent you from paying a higher rate.
- You want to borrow more money
– Perhaps you want to borrow for some home improvements or a new car. By remortgaging, you can borrow more money and switch to a deal with better interest rates for you at the same time to raise funds. This is usually more cost-effective than taking out an unsecured loan.
- You want to rent out your home
– Renting out your home with a residential mortgage will usually result in a breach of your mortgage conditions, which could lead to repossession. You’ll usually need to switch to a buy to let mortgage before you can rent your home out.
Alternatively, your current lender may offer consent to let – this allows you to rent out your home until your current fixed rate ends, which can be a better option than remortgaging if you want to rent your property out for a short period of time.
- Your circumstances have changed
– If, for example, you’ve changed career paths or just had children, your current mortgage deal may be too expensive. You could remortgage onto a more affordable deal.
- Your home has become more valuable
– You may be eligible for lower rates if your home’s value has gone up.
- You are worried about rising interest rates
– By remortgaging, you can avoid high interest rates by switching to a different deal altogether.
What is the criteria for remortgaging?
All lenders will have different criteria you will need to fulfill to remortgage, depending on what deal you want to remortgage onto and why you’re remortgaging. You will need to satisfy your new lender’s requirements for the specific deal you want to remortgage onto, so you will usually need to undergo a credit check and other affordability checks.
If you want to remortgage your home onto a buy to let deal so that you can rent it out, your eligibility will be worked out differently. Lenders assess eligibility for buy to let mortgages based on how much rental income the property would be likely to make, rather than the borrower’s income (although they still may check your income and credit score). When considering remortgaging onto a buy to let, consider whether your area and your property is likely to be popular with renters.
When can I remortgage?
You can usually remortgage your property once you’ve had your current mortgage for at least six months. However, bear in mind that the earlier you remortgage, the more you’ll probably have to pay in early repayment charges.
How do I remortgage my property?
To remortgage, you will be required to undergo your new lender’s eligibility checks as you would if you were applying for your first mortgage. Your credit score will be checked.
Once you’ve found your mortgage, you will need to obtain a redemption statement from your current lender, to find out precisely how much you need to repay. Once you’ve received your new loan from your new lender, you use this to pay back your existing mortgage.
You will also need a conveyancing solicitor. Our partner company, Starck Uberoi Solicitors, work in-house with our mortgages team and can help you remortgage your property quickly and easily – plus, they offer a discount on their conveyancing services for our clients!
How long does the remortgaging process take?
Remortgaging can take anywhere between 4 and 8 weeks after the initial application, depending on what your requirements and circumstances are.
However, there are some things you can do to make this process move faster – ensuring you have collected all of the relevant documents, and having worked out how much you can afford to borrow in advance, can speed up the process.
Can I switch to a different mortgage with my current lender?
If your current lender offers a better deal, you don’t need to remortgage onto a deal with another lender – you can simply call us and we will be able to discuss your options. Switching products is often quicker, easier, and means you won’t miss out on any loyalty perks your lender offers for having a mortgage with them for a certain amount of time.
This doesn’t mean you shouldn’t consider what other lenders have to offer, however – our mortgage brokers can provide more recommendations for you and help you weigh up the benefits of each of your options.
Do I need a deposit to remortgage?
You often won’t need a deposit in order to remortgage, as most lenders will accept the equity you’ve already built up in your home.
However, if you haven’t yet built up enough equity in your home to qualify for the mortgage you want, you can add an additional deposit on top of your current equity. Alternatively, if your current mortgage allows overpayments, you can build up your home’s equity quickly this way.
How Starck Uberoi Wealth can help?
If you are considering remortgaging, contact Starck Uberoi Wealth today to discuss your options. We offer independent mortgage advice with recommendations from across the whole of the mortgage market,
Additionally, our connection with Starck Uberoi Solicitors allows us to offer a full legal and financial service to our clients. Once your mortgage adviser has found the best remortgage offer for you, they can work under the same roof with your conveyancing solicitor to complete your remortgage process as efficiently as possible. For an appointment with one of our Mortgage advisers, speak to us on 020 8840 6640 or contact us at info@SUWealth.co.uk. Our offices are located in Brentford and Ealing, and are easy to reach by bus or train.