ThinkIFA guide to ‘Remortgage’
If you already have a mortgage and either want to transfer to a better deal, move home, consolidate your debts or simply change the deal you have then you may need to remortgage. This is usually done with a different lender, although it’s not always the case.
Remortgaging can free up cash to spend on home improvements or paying off debts, although you should consider the risks very carefully. You may also be able to release some equity if your home has increased in value.
Remortgaging can also open your options to better deals on the market.
Costs of Remortgaging
There are usually costs involved in remortgaging, such as an early repayment charge, administration costs and product fees. Some lenders may also require a new survey and valuation of your home, although these may be offered free as an incentive for choosing that particular lender.
You must remember that while you may be required to pay out initially, remortgaging could save you money in the long run.
When to Remortgage
Many mortgage deals are offered for fixed periods such as 2 or 5 years on a certain deal and once that deal is over the mortgage automatically rolls over onto a less favourable deal. Once this deal is nearing its end, this may be the time to consider shopping around to see if there are any better deals on offer.
It’s always advisable to review your mortgage regularly to check that it is still performing well and suited to your circumstances.
There are many different types of mortgage available such as variable rate, tracker mortgage, capped rate or collared mortgage and it worth considering all your options carefully. Other lenders offer incentives for choosing them such as cashback mortgages or you can combine your mortgage with your current or savings account as an offset mortgage.
Ideally you should speak with an independent financial adviser who will take your ongoing circumstances into consideration and can advise you on which type of mortgage would work best for you.
Because they have many years experience within the market and are completely independent they can offer deals from a wide range of UK mortgage providers.
What should I do now?
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