REMORTAGING
Remortgaging is the act of switching your existing mortgage to a new deal, either with your existing lender or a different provider.
Re-mortgaging your home in the right circumstances can be a smart financial decision but there are pros and cons to remortgaging.
If you are thinking of remortgaging as a way to consolidate debts or to pay for home improvements please do speak to us to get advice. Remortgaging may seem attractive as mortgages have relatively low interest rates when compared to credit cards or loans but borrowing over a long period may cost a lot more in the long term.
Why Would I Remortgage?
Your current fixed rate is coming to an end
You would like to over pay and your lender won't let you
You would like to borrow more
You're worried about interest rates going up
You would like to switch from interest only to repayment
You're worried about interest rates going up
We can help you decide what the best solution is regarding your remortgage. Our aim is to provide you with all the facts so you can make an informed and financially sound decision.
In order to make an informed decision you need to know what kind of mortgages are available
Fixed Rate Mortgages
A fixed-rate mortgage is a mortgage where your interest rate is guaranteed to stay the same for a set period of time.
After this set period of time you would move onto the lenders Standard Variable Rate which is usually significantly higher.
To avoid this you may consider remortgaging at the end of your fixed rate. to read more about remortgaging click here
Tracker Mortgages
Tracker mortgages are typically aligned with the Bank of England Base rate for a set period of time, often between two and five years.
If the Bank of England base rate were to increase, the interest rate on your mortgage would also increase and your monthly payments would rise. Conversely, if the base rate were to decrease, you would see the benefit as your monthly repayments would be reduced.
Discount Mortgages
With a discount mortgage, you pay the lender's standard variable rate (a rate chosen by the lender that doesn't change very often), with a fixed amount discounted. For example, if your lender's standard variable rate was 4% and your mortgage came with a 1.5% discount, you'd pay 2.5%.