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How does a remortgage work?

Remortgaging is a process many homeowners undertake to explore better financial opportunities or adapt to changing circumstances.
Exiting a fixed rate early

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Let us do the research for you, we will know the deals you might not, and we will have access to remortgage deals you won’t be able to access on your own.

There are many remortgage deals on the market and it can help to shop around to find the right one for you. From your current lender to the high street, but there are many different companies offering deals, with lots of options.

Check our remortgage calculator to see the sort of costs you could be paying.

Here’s a comprehensive guide to simplify the process and help you make informed decisions:

Exploring Your Options:

  • Begin by researching the remortgage options available in the market.
  • Different lenders offer varying deals, so it’s essential to compare and find the one best suited to your needs.
  • Start this process around six months before your current deal ends to allow ample time for exploration and decision-making.
  • Speaking with a mortgage broker will make this process much easier, as they do all the leg work and know the right remortgage deals

Getting Pre-Approval:

Before diving into the application process, consider obtaining an agreement in principle (AIP) from a lender.

  • This provides an indication of the amount you can borrow and helps set realistic expectations.
  • Lenders will conduct either a soft or hard credit search. Whilst a soft search shouldn’t affect your credit score, a hard search will be visible to other lenders and could affect your credit score.

Consider Costs:

Remortgaging involves more than just securing a lower interest rate; it’s essential to consider associated fees.

  • These fees may include arrangement fees, broker fees, legal fees, valuation fees, and administrative charges.
  • Both your current and new lenders may impose various costs, so ensure you understand the full financial implications before proceeding.

Submitting Your Application:

Once you’ve researched your options and considered costs, it’s time to proceed with the application process.

  • Choose the remortgage deal that best aligns with your financial goals and submit your application.
  • Having pre-approval can expedite this process and provide added confidence in your decision.

Reasons to Remortgage:

Understanding why homeowners remortgage can provide valuable insights into whether it’s the right decision for you.

  • Common reasons include reaching the end of a fixed-rate period, wanting to save money, or accessing equity for home improvements or releasing money.
  • It’s crucial to assess your individual circumstances and financial goals to determine if remortgaging is right for you.

When Remortgaging May Not Be Suitable:

While remortgaging offers potential benefits, it’s not always the right option.

  • Factors such as a worsened financial situation, decreased property value, or facing early repayment charges may deter homeowners from remortgaging.
  • Carefully evaluate your current circumstances to determine if remortgaging is a viable and beneficial choice for you.

How to Remortgage:

Understanding the remortgage process and its various components is essential for a smooth experience.

  • Whether you choose to stay with your current lender or switch to a new one, gather all necessary documents and prepare for the application process.
  • Consider consulting with a financial mortgage advisor (such as clever mortgages) to ensure you make well-informed decisions tailored to your unique circumstances.

Timing and Duration:

Remortgaging typically takes one to two months to complete, but it’s essential to start exploring your options well in advance.

  • Beginning the process around six months before your current deal ends allows ample time for research, application, and transition.
  • Securing your new deal in advance ensures a seamless transition.

Early Remortgaging:

While you can remortgage at any time, early remortgaging may come with additional costs, such as early repayment charges.

  • Assess these charges carefully to determine the optimal timing for your remortgage.
  • Early remortgaging can offer financial benefits, but it’s essential to weigh the associated costs and benefits before proceeding.

Remortgaging with Bad Credit:

Even with a less-than-ideal credit score, it may still be possible to remortgage.

  • We are a bad credit specialist broker that can assist homeowners with bad credit in securing remortgage deals tailored to their circumstances.
  • While options may be more limited, exploring alternative lenders and consulting with a broker can help homeowners find suitable remortgage solutions.
Cheap Mortgages

By understanding the remortgaging process, considering associated costs, and assessing your individual circumstances, you can make informed decisions to achieve your financial goals. Whether you’re looking to save money, access equity, or adapt to changing circumstances, remortgaging offers a flexible and versatile solution for homeowners.

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