If you are a few years into your homeownership, you may be coming to the end of your fixed-term mortgage deal. This means that you will no longer be on a previously agreed monthly repayment fee. Instead, you will be automatically switched to your lenders’ standard variable rate.
If you want to benefit from a guaranteed mortgage repayment each month, you may need to consider whether it is the right time to remortgage your property. This means that once you have come to the end of your fixed-term agreement, you can look for a new mortgage deal that works in line with your budget and your lifestyle.
There are many advantages and disadvantages to remortgaging your home. In our latest article, we’ll explore what remortgaging is and help you understand when it is the right time to find a new deal. We can also explain when it may suit you to stick with your SVR for a little longer.
While this article is just a general guide, our dedicated mortgage advisors can offer personalised advice based on your individual finances. For example, we can talk through the different remortgage options available or find you a great mortgage deal that could potentially reduce your monthly repayments or reduce the length of your mortgage term.
To find out more, please phone our mortgage helpline on 0333 005 0333.
What does remortgaging mean?
Remortgaging is when you replace the initial mortgage on your property. When you first took out a mortgage, you may have had a great deal suited to your lifestyle and budget. But as time goes on, that initial mortgage deal may have expired, and better deals may now be available. As such, you may be looking to switch your existing mortgage offer to an alternative deal – either with the same lender or with a new lender.
Remortgaging doesn’t have to be complicated. You have the right to remortgage at any time, although if you are in the middle of your fixed-term deal, you may need to pay Early Repayment Charges.
When handled correctly, remortgaging should be relatively stress-free. Our Mortgagemove advisors specialise in remortgage deals, and we are proud of how we can find effective financing solutions for our clients. To find out how we can help you, please contact us.
Why should I remortgage my property?
There are many reasons why you may be considering remortgaging your property.
- You want to amend your monthly capital repayments (you can choose to increase or decrease your payments)
- You are keen to amend your mortgage term (you can change how many years you have left before you’ve made all of your payments)
- You’ve come to the end of your fixed-term deal, and you don’t want to be on a standard variable rate (which is often more expensive). Standard variable rates are linked to the Bank of England base rate – if the BoE changes its interest rates, your mortgage repayments could rise without any notice.
- Your property may have increased in value. Therefore, remortgaging to a different mortgage could put you into a different loan-to-value ratio, making you eligible for better rates.
- You want to make a significant overpayment and change the overall mortgage loan size, but your current lender won’t allow you to make overpayments.
Do I have to stick with the same lender to remortgage my property?
You do not need to stick with the same lender when you remortgage. It would help if you researched what mortgage deals are available to find the right option. When you’ve found the right option for you, remortgaging should be quick and easy to do.
We can manage your remortgage on your behalf. Our trained mortgage advisors can not only identify what deals are available and make recommendations based on your lifestyle, but we can also manage the application paperwork and processes for you. For example, we can talk to your existing lender, confirm your eligibility with your preferred lender, and ensure that everything is managed on your behalf.
When is the right time to remortgage?
You should periodically check your mortgage details to confirm that you are still on the right deal. Throughout your mortgage term, your life may have changed dramatically. You may have a family, a different income, or different priorities. Reviewing your mortgage can prevent you from paying more than you need to each month.
We will contact you 6 months in advance of your fixed term deal expiring. This will give us enough time to find a suitable deal and process the application before you are automatically moved to your lender’s SVR.
Can I reduce my payments or mortgage term when I remortgage?
Yes. As you replace your current mortgage deal, you can decide how much you want to pay each month towards your capital repayments. You can also decide to reduce or extend your mortgage term.
If you can have a better interest deal, you may find that you could reduce your overall mortgage length while paying a similar amount. Over the entirety of your mortgage, this could save you hundreds or even thousands of pounds.
When should I avoid remortgaging?
We treat all of our clients as individuals, and what may be right for some people may not be suitable for others.
However, our experience has shown us that there are some moments when remortgaging may not be the best option for you.
- If you are looking to move house shortly, sticking with an SVR for the short term could prevent you from paying any financial penalties or needing to port your mortgage.
- Early repayment charges and product fees could be expensive. Therefore, you may find that it’s financially wiser to wait until you are close to the end of your fixed deal before deciding to remortgage because you are not making any short-term savings.
- Have your circumstances changed? Perhaps you’ve changed jobs, become self-employed, or have accrued some debts and have a recent history of bad credit. If your circumstances are different, you may no longer meet a lender’s eligibility criteria, which could make remortgaging difficult.
- If you have little equity in your home or your home’s value has dropped, you may not be making any financial savings through a remortgage. In these instances, you may need to make overpayments or wait for the housing market to stabilise to take advantage of a better mortgage deal.
Mortgagemove can help you with your remortgage
We specialise in helping our clients benefit from the most appropriate mortgage deals that we can find.
Our team will work closely with you to identify what you want to achieve from your remortgage. We can find cheaper monthly deals or better interest rates. We can reduce or extend your overall mortgage term. Or we can even find deals that offer better terms and conditions, such as fee-free mortgages or deals that allow regular overpayments.
Once we are confident that we’ve found the right remortgage deal for you and your family, we can manage the entire process on your behalf. You won’t need to spend hours on the phone trying to get hold of your existing lender or try to decipher any complicated terms and conditions. Instead, you can rely on our mortgage advisors to handle the entire process from start to finish.
And it all starts with a short 15-minute phone call to our mortgage helpline. All you need to do is call our freephone mortgage advice line on 0333 005 0333. Alternatively, you can text ADVICE to 82228.
Your home may be repossessed if you do not keep up repayments on your mortgage.