The Do’s and Don’ts of Remortgaging Your Home
Whether you are remortgaging your property to lower your monthly repayments, or to borrow more to cover home improvements, it pays to be prepared ahead of time and understand the ins and outs of the remortgaging process.
This guide is designed to help you prepare for the remortgaging process with a few tips to make sure you secure the best deal.
Don’t leave remortgaging to the last minute
If you are remortgaging because you are reaching the end of a fixed-term agreement, it’s important to start preparing ahead of time to secure a new deal and avoid transitioning onto your lender’s standard variable rate – which will be more expensive than competing mortgage services.
You should consider planning for your next mortgage three to six months before your existing deal is due to expire. If you previously secured your mortgage through a broker, they should contact you well in advance to remind you that your current arrangement is coming to an end.
Do get your mortgage documents ready ahead of time
Remortgaging your property will generally take six to 12 weeks to complete, but any delays caused by unexpected issues or missing documents could add weeks to the process.
The documents you’ll need to re-mortgage your property are largely the same as the documents you provided when you first secured a mortgage. To help the remortgaging process run smoothly, you’ll need to provide:
- Three month’s payslips
- Three month’s bank statements
- Three year’s tax returns/accounts (if self-employed)
- Proof of address (normally a utility or electric bill)
- Proof of any other income, such as bonuses, inheritance, or savings
- ID (passport or driving licence – remember that a provisional driving licence will not be admissible)
Don’t stick with your current lender without shopping around
When you come to the end of your current fixed-term arrangement, your lender may offer you a new deal as an alternative to transitioning to their standard variable rate (SVR). This is known as a project transfer rather than a remortgage and while this can be a way to secure a fixed rate quickly, you may find that you are locked into a higher rate than if you remortgage with another lender.
Shopping around and comparing all of the deals on the market can be the difference between securing the best possible interest rate and paying more than you need to. A lower monthly rate can mean that you pay less in the long run for your mortgage, even taking into account any valuation or legal fees associated with the remortgage.
Do get the best mortgage advice
Getting the wrong mortgage deal could cost you hundreds, if not thousands of pounds each month, so it’s important to make sure you shop around.
Although it’s possible to approach lenders directly to compare rates, a mortgage broker can compare hundreds of mortgage products quickly to help you find the best deal.
Even if you have previously spoken to your lender directly, your broker may have access to deals that would otherwise be unavailable, so it’s best to shop around rather than accepting the first deal you are offered.
Don’t forget to consider remortgaging fees
One of the easiest mistakes to make when remortgaging your property is focusing exclusively on the rates available and ignoring how fees can impact the overall cost of your mortgage. Choosing a product that initially seems attractive can soon backfire if you are expected to pay costly early repayment fees to your current lender, or expensive legal fees.
Conversely, paying for valuation and legal fees upfront can pay dividends in the long run if your new rate is low enough to save you money during the full term of the deal.
Some lenders will even cover legal and valuation fees when you choose their deals, so it’s worth checking the terms of every available arrangement before you decide to commit to a deal.
For the best friendly, expert advice contact us today or give us a call on 0161 443 4830.
We’ll take care of the whole remortgaging process and make sure you find the best possible deal.
Your home may be repossessed if you do not keep up repayments on your mortgage.