Remortgage with Same Lender

You wouldn’t ever really remortgage with the same lender, but you can sometimes switch to a new product with them via a product transfer. Call us on 0203 773 7299 to find out how we can help.

 

WHY REMORTGAGE YOUR HOUSE?

In today’s competitive market, many borrowers choose to switch their mortgage every few years to take advantage of the new rates on offer. Those that remain on their lender’s SVR (standard variable rate) after their initial product ended could lose out on a range of potential benefits, not least the opportunity to reduce their monthly payments, which could be a significant margin in some cases.

 

We’ve listed some of the main reasons why people re-mortgage below.

 

To Save Money

Remortgaging can help you save money if your fixed rate or deal is about to end. Rather than go onto your lender’s SVR, which is normally significantly higher than their introductory rates, you can change lenders and take out a new deal.

 

However, before you steam ahead and remortgage, you may want to consider contacting your current lender first. If you’re on a fixed or discounted rate, your lender will usually write to you a few months before it ends and you’re transferred onto their SVR. They’ll ask you to contact them or your broker about your options. Your lender will want you to remain as a borrower with them, so they’ll give you the opportunity to choose from better rates they offer to existing customers – these are often not the same as the products offered to new customers. This could help you save money on your monthly repayments or repay your mortgage sooner.

 

In the case that your lender doesn’t have decent or suitable deals on offer, you should consider switching to another lender. However, before you make any final decisions, you may want to speak to a mortgage broker. We can help you compare deals.

To Consolidate Your Debts

Remortgaging can allow you to consolidate other debts, like car loans or credit card balances. You release some of the equity in your home and take out a new mortgage with a new lender for a higher amount, then you use the additional money to pay off your other debts, consolidating them all into one – your new, larger mortgage.

 

We recommend that you think carefully before consolidating your debts this way. A new mortgage can help you organise what you owe and meet payment deadlines, however mortgages are over longer periods of time than credit cards and personal loans so you may end up paying more overall, despite the fact they usually come with much lower interest rates.

Nonetheless, sometimes it really could be the best option. It’s important to seek advice before you commit to consolidating your debt. You’ll need to make sure that you can keep up with the repayments, otherwise you risk the repossession of your home.

 

To Raise Money

Higher income or a rise in your property’s value means you could remortgage and raise more money to help pay for major outgoings, like home improvements, a wedding or your child’s university costs. This could save you from needing a separate loan.

 

To Avoiding Moving Home

A remortgage can be a convenient way to raise funds for home improvements – like an extension, an upgraded kitchen or a second bathroom. That way, you don’t have to uproot your lives and move to accommodate changing needs within the family.

 

WHEN CAN YOU REMORTGAGE?

Remortgaging

When you take out a new mortgage, you’re normally offered an introductory deal – a reduced rate for a set period and certain freebies, like a free legal service or valuation. Introductory deals can range in length, then once the deal ends, you’re moved onto that lender’s SVR. Their SVR is usually much higher than their introductory rates.

 

You can start to organise your next mortgage up to 6 months before the end of your existing rate. Mortgage offers can take 3 – 4 weeks to process and the legal work can take 2 – 3 weeks. The new mortgage offer itself is often valid for up to 6 months so, if everything is completed and ready to go early, you can instruct the solicitor to wait until any early repayment charge period with your current lender has expired before proceeding. It’s often worth looking for better rates prior to your current deal finishing, otherwise you could end up paying more than you need to – specifically if the new mortgage isn’t ready to go when your current deal ends and you’re moved onto your lender’s SVR.

 

HOW LONG DOES IT TAKE TO REMORTGAGE?

Remortgaging takes, on average, about 4 – 6 weeks but it can take less. It’s much more straightforward than buying a new home; the deeds of the property are already registered in your name when you remortgage meaning that a large administrative portion of the mortgage process is eliminated.

 

HOW DOES REMORTGAGING WORK?

Our process is usually as follows:

 

You contact your current lender for a redemption statement. The statement shows how much is outstanding on your current mortgage on a specific day and any fees associated with repaying it

Your personal mortgage adviser searches around the market and finds the best deal for you

If you are happy to proceed, your adviser presents your current situation to the new lender for a Decision in Principle (DIP)

Assuming the DIP is successful, your adviser goes through the proposed mortgage illustration and walks you through the full mortgage application, which they then submit on your behalf. You supply relevant documentation, e.g. passports, pay slips, tax calculations, bank statements, proof of address, etc.

Your new lender requests a valuation report for your property. Your appointed solicitor then requests title deeds together with any lease that may be present and any extra questions that may need answering

After your lender approves your mortgage application, you and the solicitor arrange a completion date. This is the date the solicitor draws the “new” money down from the new lender and uses it to clear the balance with your current lender.  Any money left over is paid to you

CHOOSING THE RIGHT REMORTGAGE HOUSE DEAL

When considering which mortgage to choose, you should look at all the current deals on offer and the relative advantages these present to your circumstances. Lenders want you to remortgage with them, which means they want you to switch to them from your current lender. They need to give you a reason to change lenders, so they offer competitive rates of interest and free features to make the switch as easy and cost-effective as they can. Deals will vary and what’s best for someone else might not suit you – and vice-versa.

 

You can compare remortgage rates on our website for an idea of what to expect, or see Mortgage Types Explained to learn about the different products available.

 

DO YOU NEED A REMORTGAGE VALUATION?

Before you start looking at mortgage rates, you need to estimate what your property is worth. It’s important that you’re realistic, as your lender will eventually conduct their own valuation to confirm your estimate – this will be via an online desktop valuation or internal inspection.

 

You can arrange your own valuation with an independent surveyor to find out the value of your property, but this can be expensive and the lender will still need to instruct their own valuation anyway. You’re better off talking to some local estate agents and using property websites like Zoopla or Rightmove, or even Mouseprice to come to a figure.

0203 773 7299
info@landmarkprivatefinance.com

 

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.