Why remortgage, and who can help you?

Remortgages are for people who are not first-time buyers, nor are they moving home, but they are taking out a new mortgage on their current property where they still live.

You may want to remortgage for a number of reasons. Maybe you simply want a better mortgage deal and would like to save money. Maybe you’ve got outstanding debts elsewhere and borrowing the money on a mortgage to pay your debts off will give you a lower interest rate to repay. Maybe you’re using the equity in your house to get some cash to fund an investment elsewhere.

Whatever your reasons, a remortgage can save you money, as estimates suggest that more than half of all UK borrowers are paying more than they need to for their mortgage. Often they have slipped onto the lender’s standard variable rate – which represent the highest rate a lender will have.

The maze of mortgages and rates, deals and fees have made remortgaging trickier than ever, and is wise to your homework, and even wiser to employ the services of a mortgage broker for <a href="http://www.firstmortgage.co.uk/Remortgage-types">remortgages</a>. However, make sure you understand what, if any, there charges are before you start.

When looking at remortgages be aware of what penalty charges you might have to pay if you redeem your existing mortgage early. That’s also something to look for when sifting through the remortgages available to you, as you want to avoid tie-ins and harsh penalties on early redemption.

You should have no feeling of loyalty towards your current lender as they do not pay it that loyalty, instead offering their best deals to new customers, and treating existing customers with disdain.

With interest rates on the rise in the first seven months of this year, much mortgage lending was buoyed by people looking for remortgages before their existing deal ran out. Without remortgage volumes, the lending for the year would have been much lower.

People remortgaging are faced with the same choices as people moving house or first-time buyers: fixed deals, variable, capped, discount. You broker or advisor will be able to help you make the best choice for your personal circumstances, and they have access to much more of the mortgage market than you could achieve by walking down your high street and searching for a deal from the biggest banks and building societies. You can and should some research of your own – probably on the internet – but not even there are all deals shown that are available to brokers and advisors. They will also be able to help you with the complications of the length of your new mortgage and the associated fees – and how best to keep them down.

Remortgaging can save you money – and you should certainly look for a better deal. Of course, it may cost you more in monthly repayments, because you might be borrowing more money, but make sure that you are getting the best value and best deal for your own personal circumstances. Many people remortgage every couple of years to make sure they are getting the best current deal.