If you’re thinking about remortgaging your home, then you’re definitely not alone. Every year, thousands of homeowners are in the same boat. Most of them are looking to switch mortgage deals to get a better rate, lower their monthly payments, or borrow more. Browsing mortgage comparison websites might seem like a simple task, but seeking out professional remortgaging advice is often the smartest move in the long run.
It’s not just about finding the mortgage with the lowest annual percentage rate. I mean, sure, that does help, but working out which remortgage deal is right for you is actually a whole lot more complicated than that. You’ve got to figure out your own financial situation, pick the best option for your circumstances, and make sure you’re not making any costly mistakes.
Let’s take a closer look at where expert guidance can make a real difference.
What Does Remortgaging Mean?
Before we get into the benefits of having professional advice, let me just give you a brief rundown on what remortgaging means.
In simple terms, remortgaging means switching your existing mortgage to a new deal. This can involve moving your mortgage to a different lender, or negotiating a new deal with your existing lender through a product transfer.
Many people remortgage when their current deal ends, especially if they’re getting close to the end of their current deal and want to avoid moving onto a standard variable rate. Other people might decide to remortgage to release equity from their home, fund home improvements, or secure a lower interest rate.
Whatever your reason for remortgaging, getting the right advice can really help you secure the best deal.
Why People Remortgage
There are many reasons why people remortgage, including:
- Securing a better mortgage rate
- Lowering monthly repayment costs
- Releasing funds if the value of the property has increased
- Switching to a different type of mortgage
- Consolidating some borrowing
- Avoiding a standard variable rate after the current deal ends
In many cases, remortgaging could save you hundreds, or even thousands, of pounds over the life of your mortgage deal.
But not every remortgage deal that looks like a good deal on the surface is actually the best option for your situation. That’s where expert support comes in and makes all the difference.
How a Mortgage Broker Helps You Find the Best Remortgage Deal
A qualified mortgage broker has access to far more deals and understands how lenders assess applications.
When you start the remortgaging process, a broker can help compare deals across several different providers rather than just what’s on offer from your current lender or bank.
This means you might find:
- Better mortgage rates
- Lower fees
- More flexible repayment options
- Exclusive deals that you might not find anywhere else
- More suitable options that are tailored to your needs
Rather than spending hours researching the best deals on your own, a broker can give you a quick rundown on the best option for you based on your financial situation.
Many homeowners think that they’ll get the best deal with their existing lender, but that’s not always the case. Sometimes, a deal with a different lender can offer some really significant savings.
Understanding the True Cost of a Remortgage Deal
One of the biggest mistakes people make is just focusing on the interest rate.
A low mortgage rate might sound great, but there are many other costs to factor in too.
For example, you’ve got your legal fees, valuation fees, arrangement fees, early repayment charges, and admin costs. If you pay an early repayment charge to leave your current deal before your agreement ends, it could reduce the savings you gain from switching.
A mortgage broker will carefully assess the overall cost of a new deal rather than just going for the one with the lowest headline rate.
This helps ensure you find the best remortgage deal for your situation.
How Credit Score and Financial Circumstances Affect Remortgaging
Another area where professional advice makes a real difference is understanding lender criteria.
Every lender will check factors such as:
- Credit score
- Income
- Employment status
- Existing borrowing
- Value of your property
If your financial situation has changed since you first got a mortgage, your remortgage options might change too.
A broker can help you identify lenders that are more likely to accept your application, and help you avoid unnecessary credit checks, which can improve your chances of getting remortgaged successfully.
Using a Calculator Isn’t Always Enough
Many people use a remortgage calculator to work out potential savings, and while a calculator might be a useful starting point, it doesn’t give you the full picture of the situation.
A calculator can’t factor in several important details, including:
- What your plans are for the future
- Whether the mortgage product can be adapted or changed in any way
- Any early repayment penalties or charges that might be involved
- Over-payment options: does the lender allow you to put more money towards your mortgage when you can afford it?
- Individual lender criteria: some lenders are more flexible than others
For example, if you want to overpay on your mortgage in the future, some lenders are way more flexible than others.
Getting the right advice from a professional can help you find a better mortgage deal than just choosing the cheapest one available.
Remortgage to Release Equity for Home Improvements
Another common reason to remortgage is to release some equity from your home.
If your property has increased in value, you might be able to remortgage to release equity and access funds for home improvements, extensions, or other major expenses.
However, always think twice before taking on more debt. A professional adviser can explain the long-term impact on your repayment costs and help you figure out if a remortgage to release equity is the most suitable option.
A Practical Remortgage Guide for Homeowners
As a general remortgage guide, experts recommend reviewing your current mortgage deal several months before it ends.
In fact, many homeowners start exploring options around six months before their mortgage expires, which gives them plenty of time to:
- Compare deals
- Review their current deal
- Get all the paperwork in order
- Secure a new mortgage deal
If you leave it too late, your lender might put you onto their standard variable rate, which is usually a lot higher than any fixed-rate alternatives.
The Bank of England base rate can also influence mortgage pricing, so timing is everything when it comes to securing a cheaper deal.
Find the Best Remortgage Deal with Confidence
Whether you want a lower mortgage payment, need to borrow more, or simply want access to better mortgage rates, having a professional on hand to guide you through the entire process can make all the difference.
From helping you compare deals and understanding what to expect from the remortgaging process to finding you a better rate and avoiding any hidden charges, expert support can help you get the best deal available.
If you’re coming up to the end of your current deal, now might be the perfect time to start looking at your remortgage options and find the best remortgage deal for your needs.
Frequently Asked Questions About Remortgaging
How Does Remortgaging Work?
Many homeowners ask how remortgaging works. In simple terms, you swap your current mortgage for a new one, either with the same lender or by taking your mortgage to a new lender.
Should I Use a Broker?
Some advisers charge for mortgage advice, while others only charge in certain circumstances. Either way, getting professional guidance can save you a lot of money in the long run.
Can I Stay With My Current Lender?
Yes, you can do that. You may be offered a deal to transfer to a new product and a new rate from your current lender, but it’s still worth looking around a bit before making a decision.
How Can I Find the Best Remortgage Deal?
The best approach is to compare deals across multiple lenders, get independent financial advice, and carefully review all the costs involved rather than focusing only on the interest rate.
