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Home » Your Ultimate Guide to Remortgaging Your Home

Your Ultimate Guide to Remortgaging Your Home

Ciarán Power
September 2, 2022

Table Of Contents

What is remortgaging?

Remortgaging is when you switch from your current mortgage deal to another agreement. This switch can be made with either your existing lender or a new, presumably more cost-effective, one. Remortgages tend to occur when fixed terms on people’s current mortgages come to an end, but switching to a different mortgage deal that might be more suitable to you before the end of your deal can also take place.

When considering remortgaging your home, you may also stumble across the term product switching. Although similar, It’s important not to get product switching confused with remortgaging. Whereas remortgaging involves taking out a new mortgage with a brand-new provider, product switching occurs when your existing mortgage deal ends and you decide to take out a new deal with the same provider. We’ll cover this in a little bit more depth later.

Ok, so what are the main reasons for remortgaging your home? You might want to reduce monthly payments, find a better deal, or pay off your mortgage a bit sooner than first anticipated.

Why would you need to consider remortgaging?

Homeowners often choose to remortgage their homes to extend their initial mortgage term and in turn reduce their monthly repayments. Despite the short term benefits of this, extending the length of the mortgage term may potentially cost more money in the long term. Other homeowners may choose to remortgage in order to release the equity they have built up to put towards other costs or investments into energy-saving home improvements.

Whatever your motivation for remortgaging your home, always think carefully and get expert advice before committing to a new deal. Green Mortgages are always happy to help chat through your options when it comes to remortgaging.

Am I eligible for remortgaging?

Although remortgaging might be slightly less scary than taking the initial plunge into home ownership, it can still be a daunting and anxious time. Before you decide that remortgaging is for you, it’s important to ask yourself a few things: ‍

Is your credit score in good shape? 

A poor credit score can impact your chances of getting a good deal on your remortgage, with a particularly bad score meaning you might struggle to get any deal at all. Mortgage lenders need to understand if they can trust you to make repayments before they loan you a large amount of cash. Speak to our team of experts today about how you can check up on your current status.

By boosting your credit score before applying, you’ll stand a far better chance of success. Here are some quick tips on how to do this:

  • Pay off all of your debts
  • Make sure you pay all of your bills on time – make notes and reminders to help you remember
  • Cancel credit and store cards that you don’t use
  • Don’t go past your agreed overdraft limit
  • Avoid payday loans where possible
  • Don’t withdraw cash with your credit card
  • If you don’t have any credit, build some!

While a bad credit rating can make remortgaging more difficult, there are specialist lenders who may be able to help you change deals. There are even specialised mortgages designed for people with poor credit ratings so there are still plenty of options to you even if your score is less than perfect.

Has your employment status changed?

If you’ve recently switched jobs then you might need to wait a little while to apply for a new mortgage – even if you’re earning more than before. Mortgage lenders tend to view change as risk and are aware that most new jobs often come with probationary periods.

If you’re self-employed, you may also have to hang fire until you have at least a year’s worth of accounts to prove your income, with some lenders sometimes wanting up to three years of proof.

Will it cost you anything to leave your existing lender? 

Unfortunately, some mortgage lenders will sometimes charge hefty fees for leaving a mortgage early. Make sure to always check the fine print of your specific mortgage deal and get an understanding of any potential exit fees or early repayment charges associated with your deal.

For most people, their mortgage repayment is the single biggest outgoing each month. If your goal is to lower your monthly costs, you have to be positive that remortgaging to a new deal will make this happen.

Green Mortgages can help you understand whether it’s cheaper for you to switch – and pay for the associated legal work, exit fees, and other costs – or stay put with the same lender with a different mortgage deal.‍ Speak to our friendly team today.

Providing your financial circumstances haven’t drastically changed recently and you aren’t borrowing any extra money, you should be eligible to remortgage your home. If you do want to borrow more on your mortgage, you will need to prove to your mortgage lender that you can afford to pay back this extra money. Mortgage lenders often charge fees to make changes to deals so it’s worth checking with your current provider to find out if there will be fees associated with remortgaging. In most cases, you should be able to remortgage without any penalty.

When can you remortgage?

Ideally, when considering remortgaging you should be thinking about your options at least 6 months before your current deal ends. It’s never too early to plan for your future though so get in touch with our team today to help get everything in place well before deadlines!

Is remortgaging always possible?

If any of the following apply to you, remortgaging may not be the best option for you:

  • You’re tied into an existing deal with hefty exit fees
  • Your financial position has declined
  • The value of your home has fallen

If you have any concerns or questions, our Green experts can help you decide whether a remortgage is right for you.

How to remortgage your home

Once you’ve decided to move forward with a remortgage, the remortgaging process is fairly straightforward. All you’ll need to do is speak to your mortgage lender or a mortgage adviser, like the experts here at Green, to see if remortgaging is right for your individual situation. If you decide remortgaging is the right step to take, your mortgage adviser will find the right remortgage product to suit your requirements and complete any required paperwork for you.

How long does remortgaging take?

On average, the remortgaging process takes between 4 to 8 weeks to complete after you’ve applied and had things approved, but each home will have its individual timeline based on specific circumstances.

Do I have to have my house valued when remortgaging?

When switching lenders or borrowing extra money from your current lender, a new valuation will need to be carried out on your property. This usually involves a surveyor visiting your home for an inspection, but some lenders now conduct virtual valuations without them needing to enter the property.

How do I get my house valued for a remortgage?

Fortunately, you don’t need to do anything as your lender will arrange all of this for you. A housing surveyor will contact you to arrange a convenient date and time to carry out the valuation and a full report will be sent to you afterwards.

Can I remortgage with the same lender?

You aren’t able to remortgage with the same lender, however you will be able to product switch with the same lender instead, giving you access to a new deal on your mortgage. Green Mortgages can give you expert advice on whether you’d be better off staying with your existing lender or switching by searching the mortgage market to help inform your decision.

How often can I remortgage?

There’s no best time to review your mortgage, but if you’re worried about it, or simply think you could get a better deal, then we’d advise you to review your current mortgage deal. Green Mortgages are happy to help with this, so you can understand if this is a worthwhile option for you.

Do I need to remortgage if I want to build an extension?

You don’t have to remortgage in order to fund your extension project. You can apply with your existing lender for a further loan. This additional money qualifies as an additional and separate mortgage account so you don’t need to remortgage your home.

Do I need a lawyer or solicitor to remortgage?

You will need the advice and help of a solicitor when remortgaging. However, some remortgages do include a free legal package. If you’re strapped for time, it may be faster to pay for your own solicitor. If you need to find a reliable solicitor, Green Mortgages can help.

There are many steps to think about when considering a remortgage deal, but Green Mortgages’ team of expert advisers are happy to help chat through any concerns or questions you might have about this process. Reach out to us today and let us help you build your financial future!

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