Remortgaging

The best time to start looking at remortgaging is typically four to six months before your current term is due to expire.

If your mortgage term expires and you don’t remortgage, you will likely be moved onto your provider’s standard rate. By remortgaging with a new provider, you can take advantage of introductory offers with lower interest rates.

As long as your personal circumstances haven’t changed drastically and your property hasn’t dropped in value, then remortgaging shouldn’t be a problem. If you have had a change in earnings, lost your job or become self-employed you will need to provide evidence to show that you can afford repayments as the amount you can borrow may be affected. Speak to an adviser if you’ve experienced a change in work or your property has decreased in value; they will be able to advise the best course of action for you.

While remortgaging can save you money if you’re coming to the end of a fixed-term, you may need consider the following:

• If there is a very high early repayment charge, it may be cheaper to wait until the end of your incentive period.
• If you have a low level of equity in your property, it may be difficult to get an improved mortgage deal.

A mortgage adviser will be able to advise you on the most suitable option for your current circumstances.

If you don’t want to borrow additional money, are happy to stay with the same lender and are just looking for a like-for-like mortgage, then you may be eligible for a product transfer. A product transfer has less paperwork, no need for a solicitor or conveyancer and it can often be done over the phone.

However, you may miss out on cheaper deals from other lenders and you cannot amend people on the mortgage. To add or remove someone, or change provider, you will need to remortgage.

Yes. Being self-employed doesn’t mean you can’t remortgage, but you might need to provide additional evidence on your income.

Yes, your credit score will be checked if you’re applying for a remortgage. If you don’t know your credit score you can check it online on a free site before applying. If your score is fair or low, talk to your mortgage adviser about how you can improve your rating.

Your individual circumstances will dictate the cost of remortgaging. Factors you may need to consider are:

• An early repayment charge or overhang payments to your current lender
• Mortgage fees to your new lender
• Valuation, conveyancing and adviser fees

Fees will vary between different lenders and products. While remortgaging may give you a cheaper rate and reduce monthly repayments, it’s important to know any additional costs before going ahead.

An overhang clause relates to charges payable for a specific period of time (six months, for example) after your product term has ended. If your current deal includes overhang charges you will be required to pay these even if moving to a new product and lender.

Loan-to-value (LTV) is the limit on the amount you can borrow compared to the value of the property. It is shown as a percentage. When it comes to remortgaging, the lower the LTV required, the more mortgage deals that may be available to you. You might also be able to get cheaper deals.

Yes. If you want to take someone off the mortgage (say, if you have split up from your partner), you’ll need to apply for a remortgage and provide evidence that you can afford to buy them out and make the repayments on your sole income.