Remortgaging
The mortgage market and deals can change considerably over time. This has never been better demonstrated than over the past few years. Tumbling interest rates have meant that some very attractive mortgage products have become available for those with clean credit and plenty of equity in their home. Conversely, tightening lender criteria have led to some people being unable to remortgage.
What may have seemed like the perfect mortgage once may now appear to be expensive or unsuitable. For those that find their mortgage needs have changed or that there are better deals out there remortgages can provide an effective and affordable solution.
Many people that wish to reduce their repayments or move to a different type of mortgage decide to look at remortgages, and this is where the existing mortgage is moved to another lender. When you reach the end of a fixed-rate, discounted or capped deal, you'll probably start paying the lender's standard variable rate (SVR), which is often 1-2% higher. An Abstract Finance mortgage adviser will be able to advise you whether or not it will be cost effective for you to look at remortgaging. You need to find out how much more that SVR deal will cost you, and how much you could save by switching to a new fixed-rate, discounted or capped deal.
Our mortgage advisers will talk to you about the costs involved in obtaining a remortgage and any early repayment charges you'd incur by leaving the old mortgage, as well as the cost of taking out a new mortgage. Remortgaging will not be suitable for everybody.
If you're struggling to pay off lots of unsecured debts, a debt consolidation mortgage could be the ideal solution for you. You could take out a new mortgage that's big enough to pay off your original mortgage and your other debts. You would owe more to your mortgage provider, but you'd wipe out your other debts.
You could dramatically lower your monthly payments, since your remortgage will probably come with a much lower APR than your unsecured debts. Plus, you could make your monthly finances a lot simpler, as you'd have just one repayment to make – your mortgage.
It is important to remember that spreading your payments over a longer term could mean that you pay more in the long run, and there are risks involved in adding other debts to your mortgage as you risk losing your home if you don't keep up with your payments. If the savings outweigh the cost, it's probably worth remortgaging.
Your initial consultation is obligation free. We charge a fee for mortgage advice and will retain the commission from the mortgage lender. The precise amount will depend upon your circumstances but we estimate it will be 1% of the loan amount. Alternatively you can choose the fee only option with the commission from the lender being forwarded to you, the typical fee is 1.5% of the amount borrowed.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.