If you have an existing mortgage, you could switch to a new deal that will pay off your current mortgage. This is often done to lower monthly repayments, although care should be taken, as large arrangement fees or other costs may negate any saving.
You may have to pay an early repayment charge for exiting your existing deal, and those costs will vary according to the lender’s terms and the length of the remaining term. You may also have to pay fees associated with your new mortgage, which may include solicitor fees and application fees, and these will soon add up. If the savings you will make over the term of the deal are less than the cost of the fees, it isn’t worth remortgaging.
If you remortgage with your current lender, the process may be much quicker than swapping to another lender. However, you should allow a minimum of two months to start the remortgaging process. You will still have to undergo affordability checks to see if you can afford the mortgage, and also check your credit record.
If the amount of equity in your home has increased, you may be able to obtain a mortgage that offer a lower rate of interest. Generally, the higher the amount of equity in the property, the better the interest rate will be.
Mortgage advisors spend time studying on a CeMAP training course so that they can help home owners save money by remortgaging to a deal with a lower interest rate, and possibly reduce the mortgage term.
