Organising a mortgage can be complex and time-consuming. This is why most people would prefer not to go through the process a second time if avoidable. Many of whom may not realise they could save significant sums of money by considering a remortgage.
Remortgage deals work in a similar way to a conventional mortgage. You borrow a sum of money secured against your property which is then repaid over several years. The primary difference being that a remortgage is taken out when you already have a mortgage secured against your home.
In which case, why would it make sense to consider applying for a remortgage? If you already have a mortgage deal in place, why go through the process of applying once again from scratch?
Depending on your current situation and financial circumstances, a timely remortgage could save you a lot of money. There are two primary scenarios in which a remortgage could significantly reduce your outgoings as follows:
1. You’re Locked Into a Bad Deal
It’s perfectly possible that the mortgage you are currently locked into isn’t quite as good as you thought. Use an online remortgage calculator to see what’s on elsewhere and you may be surprised. It may be something as simple as reducing the long-term APR of your home loan or perhaps sidestepping any number of additional borrowing costs. These are the most common reasons for considering a remortgage among homeowners across the UK. Even if the deal you are currently locked into isn’t necessarily ‘bad’, this doesn’t mean you won’t be able to find a better deal elsewhere.
Compare remortgages with the help of an independent broker and you may question how good your current deal really is.
2. Your Current Deal is Coming to an End
Major lenders love luring new customers with enticing introductory offers. The problem with all introductory offers is that they are introductory only. You agree to pay a reduced rate of interest for a number of years after which the overall costs of your loan are suddenly stepped up. This is another juncture at which it could be beneficial to consider a remortgage.
Rather than simply accepting the increased APR and/or borrowing costs at the end of the introductory period, you could consider switching to a different lender entirely.
How it Works
Applying for a remortgage is a very similar process to that of a conventional mortgage. Use a remortgage calculator to work out your requirements and budget, before comparing remortgage deals from as many lenders as possible with the help of an independent broker.
Particularly if you have poor credit or limited proof of income, you may benefit from the input of an independent adviser. Organise a consultation to discuss your current mortgage and the potential benefits of a lower-cost remortgage.
It’s also worth bearing in mind that there are technically no limitations to the number of times you can remortgage your property. There’s always the chance of finding a better deal and saving a small fortune on your current home loan.