Re-mortgage
Re-mortgaging is in simple terms the process of switching your
existing mortgage to a new one, usually with a different lender. To
re-mortgage you secure a new mortgage against your property and use
the money from this to repay the previous existing mortgage,
effectively transferring it. Changes in base interest rates and
introductory offers can often mean that the rates available at
present are lower than those agreed for your mortgage when you took
it out, remortgaging is the key to allowing you to take advantage
of competative interest rates and better mortgage deals.
Reasons to Re-mortgage
There are so many reasons why a re-mortgage could benefit
you financially, so we have just mentioned the most important ones
here:
Save money - Reduce outgoings
By switching to a mortgage deal with lower interest rates you
could save a lot of money in the long term. When you consider the
amount of money involved, and the time over which the interest is
being charged on it, you can see that even a small reduction to the
interest rate can result in significant savings.
If you are primarily looking to reduce your monthly outgoings by
remortgaging, then not only should you look for a lower rate, but
you could also increase the term of the mortgage, as spreading the
repayment over a greater period of time will reduce what you pay
each month. But this will increase the amount payable in the long
term/overall.
Debt consolidation - All debts into one mortgage
Mortgage interest rates are some of the lowest available
compared with other loans. By converting all your existing debts
into one more easily manageable low interest re-mortgage you could
save money and make life easier.
Think carefully before securing other debts against your
home. Your home may be repossessed if you do not keep up
repayments on your mortgage. When considering debts the new
re-mortgage may have a longer repayment term and therefore
increase the amount repayable.
Capital Release - Releasing the positive capital in your home
If your home has increased in value since you got your
mortgage you may be experiencing positive equity. This means that
the current market value of your home is greater than its current
mortgage value. Releasing the capital can be the cheapest form of borrowing.
Other reasons - Unique situations
There are also other unique reasons for remortgaging that
apply to specific lenders - such as remortgaging to a current
account to make your money work more efficiently, or switching to a
fixed interest rate in times of high interest rate fluctuation.
Some lenders offer re-mortgage packages with a particular reason
in mind, such as home improvement packages and debt consolidation
packages. Whatever the reason for remortgaging there is no denying
the savings you could make.
How to apply for a re-mortgage
There are so many re-mortgage deals available from high street
and other lenders, it can be difficult to chose the right one for you.
You can also use this website to help choose by looking through the lender reviews
or by enquiring online and letting an expert get you the most suitable deal.
Remember it's free to enquire online through Mortgage Helpline
and there is no obligation to complete the deal.
Enquire online and let an expert get you the most suitable re-mortgage deal
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