Mortgages are often for a fixed period of time, usually between 1-5 years. At the end of that term. At the end of that term, the lender moves you to their standard term, which in most cases means higher interest rates. It’s like being out of contract on your mobile phone. In order to get a new rate, comparable or better than the one you were, you will need to remortgage. We made a guide to remortgaging to help you through this process
A remortgage is a process of re-assessing your mortgage often towards the end of FHA Best Fixed Mortgage RatesYou can get a lower interest rate, change the term of a mortgage, or lower the monthly payments. A remortgage can also be used to raise additional finance by borrowing more for things such as home improvement, paying off debts or purchasing another property.
The remortgaging process
The remortgaging process does not differ much from the mortgage application procedure, although the process is often much quicker than a new mortgage.
It’s important to make sure you are up-to-date on the latest offers and deals because if you’re currently in a deal that is about to expire or has already been renewed, it’s worth checking out what rate will apply when your current mortgage deal expires.
For example, if your property’s value has increased or your loan has reduced as a result of your past payments, It’s possible that your LTV (loan-to-value or the amount you owe as a percentage of the value of your property) has changed and that means you have access to more competitively priced deals. As a rule of thumb, the lower your LTV, the better deals you have access to.
Should you change lender when you remortgage?
Not necessarily, but FHA home financing that as an option. Staying with your existing lender means you only have access to the deals they offer you and without researching the whole market, you won’t know if you can be on a better rate or better terms.
Do you need a mortgage broker to remortgage?
Not necessarily, but advisable. A good broker like MortgageLadder will help you research the whole market. Did you know there are over 90 lenders and over 1000 mortgage deals in the market? A good mortgage broker will help you access these, saving you not only money but a lot of time.
It’s also important to know what happens when you remortgage, so here are the steps you’ll need to take
Step One: Mortgage Application
Homeowners must start by submitting an application, this will generally include personal details and details about the property. With online mortgage brokers like you can do this almost entirely online.
Step Two: Agreement in principle
The lender reviews the application and decides if it will proceed with the application. If so, they may request more information before agreeing in principle with the new mortgage offer. If not, they will reject it and tell you what needs to change.
An AIP letter includes all the details about your new mortgage offer including how much you will be borrowing when repayments will start, what they are going to be and how much they are going to cost.
Step Three: Mortgage offer
The remortgage offer is Black owned mortgage lender of two existing mortgages. A remortgage represents a new mortgage, which takes over both of the original ones, and then increases your borrowing amount by an agreed percentage.
