Should You Remortgage Your Home Loan

Remortgaging your home loan can be a great way to save money or access some extra cash, but it's not always the right decision for everyone. If you're considering remortgaging, you might be wondering whether it's worth the hassle.

A key factor to consider is the length of time you'll be paying off your mortgage. According to our research, remortgaging to a shorter loan term can save you up to 25% on interest over the life of the loan. For example, switching from a 30-year mortgage to a 20-year mortgage can make a big difference in the long run.

However, it's essential to weigh this against the potential costs of remortgaging, such as arrangement fees and early repayment charges. These fees can add up quickly, so it's crucial to factor them into your calculations.

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It's definitely worth checking the latest offers if your current mortgage deal is about to end, or has already moved to a follow-on rate. Your home could be at risk if you can't make the payments.

If your property is worth more than when you bought it, your loan-to-value ratio may have changed, and this could mean you have access to a wider range of deals. This is a great opportunity to explore your options.

Big changes in your life, planned or unexpected, could mean that your current mortgage no longer suits your needs. You may need to remortgage to find a deal that's a better fit for you now and in the future.

Your credit score is an important factor to consider, so make sure it's in good shape before applying for a remortgage.

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The remortgage process can seem daunting, but it's actually quite straightforward once you know what to expect. You'll need to start by getting an Agreement in Principle (AiP) from a lender, which is essentially a way to check if you're eligible for a remortgage without a full credit check.

To get an AiP, you'll need to provide some basic information about your income and financial situation. This will help the lender determine how much they're willing to lend you. You can usually get an AiP online, and it's not a guarantee that you'll be approved for a remortgage, but it's a good starting point.

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Once you have an AiP, you'll need to consider all the costs involved in remortgaging. This includes application fees, valuation fees, and solicitor's fees. You should also ask about any potential exit or early repayment fees if you decide to remortgage again in the future.

The actual remortgaging process involves several steps, including researching your options, considering costs, deciding in principle, applying for the new mortgage, finishing any legal work, reviewing the offer, and closing the deal. This can take around a month if you're staying with your current lender, or up to three months if you're changing lenders.

Here are some key costs to consider when remortgaging:

It's worth noting that you should start looking at least three months before your current deal ends to give yourself enough time to compare mortgages and complete the remortgaging process.

You can remortgage with a different lender, which is similar to applying for your first mortgage, or stay with your current lender. This process can be a bit different depending on your situation.

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If you're near the end of your current mortgage term, it's likely you'll want to remortgage to save money on interest rates. This is usually two to five years into the mortgage term, when the interest rate reverts to the lender's standard variable rate (SVR), which is generally higher.

Some common reasons people remortgage include wanting to lock in today's interest rates, taking advantage of lower interest rates, or releasing equity from their property. You might also want to consolidate debts or switch to a more flexible mortgage.

You can remortgage to release equity from your property to help pay for home improvements or other large expenses. This can be a good option if your property has gained in value over time or your repayments mean you own more equity.

Here are some possible reasons to remortgage:

People remortgage for a variety of reasons, but the main one is to save money when their lender's initial fixed rate or discounted period ends.

Typically, this happens two to five years into the mortgage term, and the interest rate reverts to the lender's standard variable rate, which is generally higher.

Some homeowners want to lock in today's interest rates, concerned about future rises, while others want to take advantage of a cheaper deal with a lower interest rate if interest rates have fallen since they first got their mortgage.

You might also remortgage to release equity from your property to help pay for home improvements or other large expenses, or to consolidate other debts, but it's essential to talk to a financial adviser or a debt adviser before making a decision.

If your property has gained in value over time or your repayments mean you own more equity, you can access lower LTV deals and better rates.

Here are some common reasons people remortgage:

If you're considering remortgaging with a new lender, you'll need to be prepared to provide a significant amount of financial information. This includes payslips from the last three months, tax returns from the last few years if you're self-employed, and bank statements from the last three years and your latest P60 tax form.

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You'll also need to show proof of ID and address, and there'll be a hard credit check, which has the potential to affect your credit rating. Additionally, a property valuation will be carried out.

Here's a list of the financial information you'll typically need to provide:

Keep in mind that if you're applying for a joint remortgage, you'll need to provide this information for both of you.

Remortgaging is a common practice that can help you reduce your monthly payments. You could also use it to finance home improvements or other purchases.

One of the main benefits of remortgaging is that it can help you pay off your mortgage faster by increasing the monthly payments and shortening the term. This can save you thousands of pounds in interest over the life of the loan.

To get the best deal, compare your existing mortgage with other offers. It's not just about the initial rate – you should also work out how much interest you'll pay over the full term.

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Some extra costs to consider when remortgaging include early redemption charges and exit fees, mortgage application/arrangement fees, legal and valuation costs, and mortgage broker fees. Make sure you have a complete picture of the financial benefits – or losses – of remortgaging before you commit.

If you have equity in your home, you may be able to use remortgaging to fund home improvements or other expenses. However, consider your other options carefully – a home improvement loan or 0% purchase credit card may be a better choice.

There are a few reasons why remortgaging could get you a better mortgage rate. These include:

Remortgage costs can add up quickly, so it's essential to factor them into your decision. The main fees charged by the new lender include arrangement fees, legal fees, valuation fees, and admin or account fees.

These fees can range from a few hundred to several thousand pounds. For example, arrangement fees might be £500, while valuation fees could be £1,500.

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Some lenders may also charge early repayment charges if you exit a deal before it's due to end, which can be a significant additional cost. To give you a better idea, here are some common remortgage costs:

Remortgaging isn't always the best option. If your financial situation has worsened since you applied for your existing mortgage, you may struggle to find cheaper remortgage rates.

Remortgaging can be difficult if your income has fallen or your credit score has dropped. Lenders will assess your affordability, and there are strict rules they must follow.

Not all mortgages can be ported to another property. If you plan to move soon, find out if your remortgage can move with you.

Remortgaging before your current deal ends can lead to an early repayment charge. This can be thousands of pounds, and the amount reduces over time.

Some lenders have a minimum loan amount, usually £25,000, that they will accept as a remortgage.

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When remortgaging, it's essential to factor in the costs involved. The main fees charged by the lender you're moving to may include arrangement fees for getting the remortgage.

The lender's arrangement fee can be a significant cost, so it's crucial to consider this when comparing mortgage deals. You may be able to negotiate this fee or find a lender that doesn't charge one.

Other fees to consider are legal fees for using a conveyancing solicitor and valuation fees for the property. These fees can add up quickly, so make sure to factor them into your budget.

An early repayment charge is another cost to be aware of, especially if you're exiting a deal before it's due to end. This fee can be a significant penalty, so it's essential to consider it when deciding whether to remortgage.

Here's a breakdown of the main fees you may encounter:

Before remortgaging, it's essential to consider a few key factors. You should think about your current mortgage balance, the value of your home, and the interest rates available.

Check the value of your home to determine how much equity you've built up. This will help you understand your loan-to-value ratio. For example, if you bought your home at a value of £200,000 and now it's worth £300,000, you've increased the value of your home.

The longer you've been paying off a mortgage, the better your loan-to-value ratio should be. This is because you've paid off a portion of the original mortgage balance. For instance, if you paid off £50,000 of a £150,000 mortgage, your new loan-to-value ratio would be significantly lower.

Here's an example of how your loan-to-value ratio can change over time:

By considering these factors, you can make an informed decision about remortgaging your home.

Applying to remortgage can be a straightforward process if you're staying with your current lender. However, if you're looking to switch to a different lender, it's similar to applying for your first mortgage.

To find the best deal, use our mortgage comparison tool to compare mortgage deals from across the market. This will help you make an informed decision about your next mortgage.

Comparing remortgaging options is a great way to save money on interest and fees. We can help you compare remortgaging options from across the UK market, and it's free with no impact on your credit score.

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We're here to guide you through the remortgage process, making it as smooth as possible. Our team of experts has years of experience in dealing with complex applications.

We'll work closely with you to understand your needs and goals, ensuring you get the right mortgage for your situation. This might involve discussing your current financial situation, including your income, expenses, and credit history.

Our comparison service allows you to see multiple deals in one place, saving you time and effort. This means you can easily compare rates, terms, and fees across different lenders.

We'll also help you identify the most suitable lenders for your needs, taking into account factors such as your credit score and loan-to-value ratio. This can help you avoid applying for deals that are unlikely to be approved.

Our service is free, and you won't be charged any fees for using our comparison tool or applying for a remortgage.

You're ready to make your application, which is a big step in remortgaging your home. If you've found the right remortgage deal for you, and have an agreement in principle, you're ready to begin the application process.

The application process can be very different depending on whether you're staying with your current lender or moving elsewhere. Applying to remortgage with a different lender will be similar to applying for your first mortgage.

You'll need to provide all the necessary documents and information to support your application. This may include proof of income, employment, and identity, as well as details about your current mortgage and the property itself.

The application process can take several weeks to several months to complete, depending on the lender and the complexity of your application. Be prepared to be patient and flexible throughout the process.

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Comparing mortgage deals is a crucial step in the remortgaging process. You can use a mortgage comparison tool to compare deals from across the market.

Remortgaging can get you a better rate if you're moving from a low fixed or discounted variable rate to a standard variable rate, which usually means a higher monthly payment. This is a common scenario for many homeowners.

If the value of your home has gone up, you may be eligible for lower mortgage rates. This is because you'll have a more favourable loan-to-value rate.

Comparing remortgaging options from across the UK market can help you find the best deal. This is where a mortgage comparison tool comes in handy.

We can help you compare remortgaging options from across the UK market. Comparing mortgages with Experian is free and it doesn’t affect your credit score.

Here are some reasons why you might want to compare mortgage deals:

You may still be able to remortgage even with a bad credit score, but it's harder to find a good deal.

Bad credit mortgage lenders exist that specialize in helping people with poor credit, so you're not completely out of luck.

If your credit situation is particularly bad, your current lender might still allow you to remortgage, especially if you've made all your payments on time and aren't changing the terms of your mortgage.

The lender will look at how you're managing your mortgage payments and other expenses, and what percentage of your income goes towards your mortgage.

By checking your Experian Credit Score, you can get an idea of how lenders might view you based on your credit report.

You'll be treated like a new mortgage customer if you remortgage with a different lender, which means you'll go through affordability checks again.

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