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Home » Services » Mortgage Services » Remortgages » What is a Remortgage?

What is a Remortgage?

Ciarán Power

Last Updated: February 2nd, 2024 at 6:32 pm

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Exploring the option of a remortgage can be a smart financial move, but it’s important to understand the ins and outs. At Green Mortgages, we’re experts at finding you the best remortgage deal possible, while keeping the process hassle and stress-free. Read below to learn the basics of remortgaging and what’s involved.

The Basics of a Remortgage

Remortgaging is the process of switching your current mortgage to a new deal, either with your current lender or a different one. Typically, you consider remortgaging when your existing deal ends, usually after a fixed term or a tracker rate period. A remortgage gives you the opportunity to secure a better rate, change mortgage terms, or release equity from your property for debt consolidation or home improvements. In most cases, you should look to begin the remortgage process 6 to 7 months before your current deal ends, as you can line up a new mortgage to complete on the day your current deal ends. This will mean you avoid any hefty exit fees.

Why Remortgage Your Property?

Remortgaging can offer several benefits for homeowners. One of the main reasons people consider a remortgage is to secure better interest rates. By switching to a mortgage with a lower rate, you have the potential to reduce your monthly payments and the overall cost of the loan over time. Another advantage of remortgaging is the ability to release equity from your property. If your property’s value has increased, remortgaging allows you to access some of this equity. This extra cash can be used for various purposes, such as home improvements, debt consolidation, or funding significant life events.

Additionally, remortgaging provides the flexibility to adapt to changing financial situations. Whether you need to switch from an interest-only to a repayment mortgage, adjust the term of your mortgage, or modify other conditions, remortgaging allows you to customize your mortgage to better suit your current needs. So, if you’re looking to secure better rates, access equity, or adapt to changing circumstances, remortgaging could be a viable option to explore.

Key Considerations

Before beginning your remortgage journey, it’s crucial to assess all aspects of your financial situation. Listed below are some factors to consider:

  1. Early Repayment Charges – Be aware of any Early Repayment Charges (ERCs) that may be incurred if you exit your current deal early. These charges can sometimes outweigh the potential savings from a lower interest rate. We can help you weigh up the cost-saving benefits.
  2. Credit History – Use an online credit referencing agency such as CheckMyFile to review your credit file. Ensure it all looks in order and that you are aware of any missed payments or defaults that may be seen throughout the process.
  3. Affordability Checks – Like your initial mortgage, your lender will carry out affordability checks. Ensure that your income and expenditure are fully documented via payslips, or if you are self employed, you have your latest year’s SA302 calculations completed.
  4. Changes in Property Value – If your property’s value has significantly increased, you might move into a lower loan-to-value bracket, enabling you to secure better rates. However, if the value has fallen, you might not be able to borrow as much as anticipated.
  5. Personal Circumstances – Finally, consider how your personal circumstances might change. If you’re planning significant lifestyle changes, such as starting a family or changing jobs, these could impact your mortgage affordability. You may also not want to lock yourself into a long-term deal if you have plans to move or sell your home in the near future.

By carefully considering the aspects above, you can make an informed decision about whether remortgaging is the right step for you.

Our Approach

The thought of remortgaging can seem overwhelming as many parties are involved, such as your current lender, conveyancers, solicitors, and your new lender. However, with Green Mortgages, it doesn’t have to be so daunting. Our expert team of mortgage advisors is here to guide you through each step of the process, ensuring a smooth and hassle-free experience.

First, we’ll start by assessing your current mortgage and financial situation. Our team will carefully review your existing mortgage, your income and your expenditure. With this information, we can provide you with personalised advice tailored to your needs. Once we have a clear understanding of your current mortgage and your circumstances, we’ll help you explore the cheapest remortgage options and find the best mortgage solution for you.

Next, we’ll assist you in navigating the application process with a new lender. We’ll handle all the paperwork, ensuring that everything is filled out correctly and submitted on time. Our goal is to make the process as seamless as possible, saving you time and effort. Throughout the entire journey, we’ll keep you informed about the fees involved, the timeline you can expect, and the work we do on a daily basis to ensure you receive the best service. Transparency is important to us, and we want you to feel confident and well-informed every step of the way.

Finally, when your new mortgage is in place, you can sit back and relax, safe in the knowledge that a huge piece of your financial future – your home – is taken care of.

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