Remortgaging is the process of switching your existing mortgage to a new lender or renegotiating the terms with your existing lender. There are several steps to navigate and consider when remortgaging.

When to remortgage:

If you have a fixed-rate mortgage that is coming to the end of the fixed interest term, it is worth comparing other mortgages to see if there are any available with more favourable interest rates and terms. Usually, once the fixed rate term of a mortgage ends, the interest rate increases.

Someone looking to free up the equity in their property may consider remortgaging their home. Freeing up equity means taking out some of the value of the house in cash. This is done by remortgaging for a higher value than the current outstanding amount of the existing mortgage. Mortgages are a much cheaper form of debt than personal loans or credit cards, so someone with expensive personal debt, may decide to remortgage their home to free up cash to pay off the other more expensive debts. Another reason to remortgage could be to finance home improvements.

Steps in remortgaging

Check your current mortgage agreement

Before you start looking for a new mortgage deal, review your current agreement and determine your current interest rate, term, and any early repayment charges.

Research available deals

Look at different mortgage lenders and shop around to find the best deal that suits your needs. Consider interest rates, monthly repayments, and any fees associated with the mortgage. Check the early repayment terms and any penalties.

Apply for the new mortgage

Once you have found a suitable mortgage deal, you will need to apply for it. The lender may require documentation such as proof of income, employment status, and credit history.

Valuation and survey

The lender will require a valuation of your property to ensure that it is worth the amount that you want to borrow. They may also require a survey to check the condition of the property.

Legal process

You will need a solicitor to handle the legal aspects of remortgaging. They will ensure that the new mortgage is registered with the Land Registry and that all legal requirements are met.

Completion

Once all the legal processes are complete, the new mortgage will take effect, and your existing mortgage will be paid off. You will then start paying the new mortgage according to the agreed terms.