Remortgaging is something that has become more common in recent years, due to the many benefits it can provide.
However, remortgaging can also be a little complicated and something that many of our clients have raised questions about.
So, in this article, Conveyancing Partner Michelle Petersen answers some of the most common queries around remortgaging and looks at the pros, cons and costs.
What is remortgaging?
Remortgaging is where you change the mortgage deal on your property.
There are many reasons why you might want to remortgage your home, such as getting a better deal on interest rates or to pay for home improvements.
What are the benefits to remortgaging?
Remortgaging can allow you to:
- Change mortgage deal to lower your interest rate
- Release equity from your property to fund home improvements or pay off debts
- Switch to a new lender
- Change to a more flexible deal which allows for mortgage overpayments (and is better suited to your needs)
- Switch to an offset mortgage to reduce your monthly bills
Remortgaging can save you a lot of money if done right.
Can you remortgage to another lender?
When you remortgage, you do not have to remain with the same lender, and it is good to shop around for good interest rates.
Although, it may be worth discussing with your current lender as to whether there are any benefits by remaining with them.
What is the downside of remortgaging?
When you remortgage, the term of your loan may increase and your overall debt owed may increase so this is something to consider when assessing your finances.
In addition, the potential fees involved in remortgaging can also be a major drawback.