Remortgaging

Manage your mortgage payments

Average Rating: 4.8 stars (based on 32 ratings)
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A mortgage is not a ‘do it once and forget’ financial product. Remortgaging is the process of switching your mortgage to another lender, or renegotiating with your existing lender, for a better deal. Essentially you are taking out a new mortgage contract in place of your existing one.

If you have been sitting on your lender’s standard variable rate it is worth checking to see if there is a better product that could save you money.

If your circumstances have improved, or you would like to borrow money to improve your home, remortgaging can be a cost effective way to manage your finances.

Our trusted advisors are here to help you, with expert mortgage advice to make remortgaging as painless as possible.

If you are looking to remortgage to release equity in your property, and you are aged 55 or over, try our Equity Release Mortgage services.

Professional and helpful

VA Mortgages were a great help and managed to push the mortgage through in time to meet the final deadline.

It was a very stressful few months due to the mistakes of the new lender but I now have my new mortgage and own more of my house.

Thank you for being so patient, professional and helpful.

Sarah Palmer Pope

Happy with our new rate

Very responsive and useful assistance from Les. We called with regards to changing our mortgage product, and within few days all the documents were sent to us to sign and confirm.

The details of the new mortgage were explained thoroughly and even after we came back with questions, Les explained everything patiently. We are happy with the result and our new rate!

Darya P.

Remortgaging made simple

Mark was introduced to me, a recommendation that has gone a long way in keeping me happy. I have just completed a remortgage.

In this climate of uncertainty Mark kept me informed of every detail and remained positive when everything seemed protracted. It completed yesterday and with great ease in the end. I will be returning in 5 years to do it all again!

John Kirton-Bernard

How does remortgaging work?

Switching to a new mortgage deal, with the same or a different lender, is the process of remortgaging. When a fixed or introductory discounted rate ends on a mortgage, some people choose to remortgage to find a better rate. This is similar to finding a new gas and electricity supplier at the end of an introductory offer.

When your initial introductory rate ends with your existing mortgage lender you will be moved on to their standard variable rate (SVR). This often has been higher than with a new mortgage deal, hence people often consider remortgaging at this point.

Common reasons to remortgage include:

  • You’ve taken an interest-only mortgage, and you’d like to change to repayment
  • Your introductory offer or fixed deal is coming close to ending
  • You want to find a better rate than your current mortgage
  • You’d like to make overpayments and your current mortgage won’t allow you to
  • You would like to borrow more money against your home

How does remortgaging work?

Switching to a new mortgage deal, with the same or a different lender, is the process of remortgaging. When a fixed or introductory discounted rate ends on a mortgage, some people choose to remortgage to find a better rate. This is similar to finding a new gas and electricity supplier at the end of an introductory offer.

When your initial introductory rate ends with your existing mortgage lender you will be moved on to their standard variable rate (SVR). This often has been higher than with a new mortgage deal, hence people often consider remortgaging at this point.

Common reasons to remortgage include:

  • You’ve taken an interest-only mortgage, and you’d like to change to repayment
  • Your introductory offer or fixed deal is coming close to ending
  • You want to find a better rate than your current mortgage
  • You’d like to make overpayments and your current mortgage won’t allow you to
  • You would like to borrow more money against your home

Things to consider before remortgaging

When deciding if remortgaging could benefit you, it is worth considering:

Is there an early repayment charge on your existing mortgage?
If you are locked in with an early repayment charge it can still be possible to remortgage, but you will need to pay the fee. It is worth checking what the charge would be, and how long it applies for. For some people the charge will be less than the potential savings, but for others it may be worth waiting until the end of the fixed period before remortgaging.

What is your loan-to-value (LTV)?
Your loan-to-value is the amount of your outstanding mortgage against your property’s current value. This is simple to work out by dividing your outstanding mortgage balance by your property’s current value. The lower your loan-to-value, the better the range of mortgage deals that are likely to be available to you. If you have spare money from an inheritance or savings, it can be worth using this to decrease your loan-to-value and secure a better mortgage deal.

How much mortgage debt do you have?
If your loan is small, for example less than £50,000, it is possible that switching will not save you money. There are associated legal costs with remortgaging, which are easily offset by savings for those with a higher mortgage against the fees they would pay if they did not switch. However, if your debt is small, often it is cheaper to stay with your existing lender.

Have you considered the associated fees?
There are fees associated with remortgaging. They are lower than buying a new house, but your new lender will require a valuation to assess your loan-to-value. Some mortgage products may offer free valuations or legal costs, but it will need to be considered against the long term benefit of the mortgage rate. Working with a mortgage advisor can help you to work out if remortgaging will save you money, and which mortgage product will work best for you.

Remortgaging if you are self-employed

It can appear harder to obtain a mortgage if you are self-employed. This term can also cover partnerships and director/shareholders of Limited Companies. When applying for a mortgage you can expect to be asked to provide:

  • Three years of accounts for your business
  • Three years records of your tax calculations under self-assessment
  • Three years of your Tax Year Overviews showing the tax you paid
  • Details of your accountant, if you have one

Typically, lenders will look at your profits net of allowable expenses, and net of corporation tax if a limited company. Some lenders will limit your loan according to how you have taken these profits as income, some will look at the ‘whole picture’ regardless of whether you have taken the profits as income.

Most lenders will average your profits over a two or three year period, although there are some that just look at the last year. Almost all lenders will be inclined not to lend to you if you have a track record of reducing profits in the last 2 or 3 years, in this case you will almost certainly need specialist help.

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