Remortgage Services

Remortgage Services

When you are looking for a better mortgage there has never been more competition and choice available in the market. However, this choice has brought added complexity in terms of the types of products which are now on offer. This section of our web site contains a summary of some important information on remortgages but for full details and expert advice please contact us on 0845 602 5541 or complete our online enquiry form.

You can choose to remortgage to another lender at any time but you will usually have early repayment charges during the first few years of your mortgage - normally payable over the same period as any discounted or fixed rate you received when you arranged your current mortgage. These will typically be a percentage e.g. 3% of the loan amount, or the equivalent of a number of months interest on the loan. You may also have to repay any incentives you received from your current lender such as a free valuation or help towards legal fees. You should check the Letter of Offer you received at the time, which should contain this information.

Normally the best time to remortgage is at the end of any special rate term and when any early repayment charges have expired. Most lenders offer a free legal service for remortgages and may help with the cost of your valuation.

In order to avoid paying more than you need to when your fixed or discounted rate expires, you should start looking for the best deal about 8 weeks before your current one ends. This normally gives you enough time to find the right deal, apply and complete all the paperwork. Most lenders won't write to tell you your monthly payments are changing until closer to the time and by then it may not be possible to rearrange your mortgage in time to avoid making an initial payment at their follow on rate.

What are the costs involved in remortgaging?

There may be some costs involved when you remortgage but most of these can either be added to the loan or some may be paid by the lender you are moving to. You should weigh these up against the savings you can make in terms of a reduced monthly payment. Here are some of the key costs you should be aware of when looking to remortgage.

• Booking fee - normally payable on fixed rate products to secure the particular rate you want on your mortgage. Can be payable up front but some lenders will allow you to add this on to the mortgage when it completes.
• Product fee - part of the product pricing and the general principle is that the higher the fee you are willing to pay, the lower the rate you can get. There is generally a trade off between the size of product fee you pay and the interest rate on your loan. Again, most lenders will allow you to pay this on completion of the mortgage and add it onto the loan if you wish.
• Valuation fee - the cost of having your property valued. Normally the lender will arrange this for you. Some will expect you to pay for this up front and may refund the cost (or part of it) on completion or they will pay the cost for you. Depending on the level of mortgage you require compared to the value of your house, some lenders will be happy to use an electronic valuation from industry databases or simply have an external valuation carried out, which is generally less expensive.
• Legal fees - these will be payable to the solicitor who carries out the legal work on your behalf. Lenders will often provide you with a free service if you choose to use their solicitors. However you are free to use your own, should you wish, although you may have to pay the cost of this yourself.