MORTGAGES
Remortgaging
Remortgaging offers a pathway to more favourable mortgage conditions that align with your current needs and goals. At Roxburgh Financial Services, we specialise in guiding our clients through remortgaging to secure deals that enhance their financial well being.
Whether achieving a lower interest rate, reducing monthly payments, or accessing funds for significant expenditures, remortgaging with our guidance can provide you with the right solution for your requirements.
Navigating the remortgaging process
The concept of remortgaging involves transitioning from your current mortgage to a new agreement, potentially with a different lender. This move allows you to utilise the new loan to settle your existing mortgage, essentially refinancing your home under terms that better serve your current financial situation.
Why remortgage?
Homeowners consider remortgaging for various compelling reasons. Whether it’s proactive financial management or adapting to market changes, the decision to remortgage is driven by the desire to optimise one’s financial position.
Common reasons for remortgaging include:
Current deal expiring
Current deal expiring: To avoid shifting to a higher standard variable rate post the fixed-rate term.
More competitive offers
More competitive offers: Actively seeking and moving to more advantageous mortgage deals, sometimes necessitating consultation regarding potential fees.
Increased home equity
Increased home equity: Benefiting from an appreciation in property value to secure more favourable lending rates.
Additional borrowing needs
Additional borrowing needs: Leveraging equity to finance home improvements or other significant needs.
Interest rate concerns
Interest rate concerns: Switching mortgage types to mitigate risks associated with rising interest rates.
Benefits of remortgaging your property
Remortgaging stands as a testament to the dynamic nature of financial planning in homeownership, offering several key advantages:
Financial savings
Financial savings: Potentially lower monthly payments through better interest rates.
Home improvement financing
Home improvement financing: Accessing equity to invest in your property, enhancing its value and quality of life.
Debt optimisation
Debt optimisation: The opportunity to pay off your mortgage faster with adapted repayment plans, saving on interest over time.
Remortgaging is not just a transaction but a strategic financial decision that can lead to substantial savings and financial growth when approached with the right expertise.
Unlocking a more competitive mortgage rate
One of the primary reasons homeowners consider remortgaging is to secure a more competitive mortgage rate. Initially, you may have benefited from a low fixed or discounted variable rate. However, as these deals draw to a close, transitioning to the lender’s standard variable rate is common, often resulting in higher monthly payments. Remortgaging before this switch can save you from these increased charges.
Furthermore, your property’s market value may have appreciated. In that case, you might be in a more favourable loan-to-value bracket, making you eligible for more attractive mortgage rates than previously available. Alternatively, the desire for financial predictability might drive you towards securing a fixed rate, especially in a fluctuating market where variable or tracker rates are poised to increase.
Adapting monthly repayments
Life events and shifts in financial circumstances are inevitable. Remortgaging offers the flexibility to adjust your monthly mortgage payments to better suit your current situation. An upward career move or salary increase might prompt you to opt for a mortgage that allows for larger payments over a shorter period, enabling you to become mortgage-free sooner.
On the other hand, securing a mortgage with lower monthly payments spread over an extended term can provide much-needed financial relief if your income or expenses decrease.
Funding life's milestones
Accessing your home’s equity can open avenues to finance significant life events or projects. If your home’s market value surpasses your outstanding mortgage, you could increase your mortgage size and utilise the surplus funds for home improvements, educational expenses, or even a celebratory event like a wedding. While this approach offers a solution, it’s essential to consider it alongside other financing options to ensure it aligns with your overall financial strategy.
Journey to remortgaging
The process of remortgaging requires planning and foresight. We recommend initiating the search for a new mortgage deal at least three to six months before your current agreement concludes to avoid unnecessary haste or complications. Transitioning to a new deal typically takes about a month if you choose to stay with your current lender, but it may extend to two to three months should you decide to change lenders.
Financial considerations
Remortgaging can often seem enticing primarily due to the allure of a lower initial rate. However, adopting a broader perspective by comparing your existing mortgage against potential new offers is crucial. The team at Roxburgh Financial Services will guide you on the specifics, calculating the total interest payable across the entire term of prospective mortgages and taking into account ancillary costs associated with the remortgaging process.
These may include early redemption charges, exit fees if your current mortgage is still active, application and arrangement fees for the new mortgage, and legal and valuation expenses. Collectively, these factors will influence whether remortgaging will be financially beneficial.
Credit score implications
The role of your credit score in the remortgaging process cannot be overstated. Lenders employ this metric, derived from your credit report, application details, and any pre-existing customer data, to gauge your creditworthiness. Familiarising yourself with your credit score provides valuable insight into how lenders perceive your financial health. If necessary, you can take proactive measures to enhance your credit rating before applying for remortgaging, thereby positioning yourself more favourably in the eyes of potential lenders.
Other credit applications
It’s also wise to exercise caution regarding other credit applications in the run-up to your remortgage application. Each application triggers a hard search on your credit report, and an excessive number within a short timeframe could signal financial desperation to lenders, adversely affecting your credit score. Prudence dictates minimising such applications to maintain a healthy credit profile during this period.
Ready to explore your remortgaging options and make the right informed decision?
At Roxburgh Financial Services, our commitment is to empower you with unbiased mortgage advice, drawing from an extensive pool of remortgaging options across the UK market. We dedicate ourselves to navigating you through the complexities of remortgaging, ensuring that every decision is made with your best financial interests at heart.
With Roxburgh Financial Services by your side, you’re assured of making the right informed decisions in your remortgaging journey. Unlock the door to tailored mortgage advice.