REMORTAGAGE

Remortgaging

Topic provides a great starting point towards understanding how money can be saved by remortgaging. As well as saving money, remortgaging can also help raise money for home improvements, holidays, university fees - you name it. Many of our clients raise money by remortgaging, but still end up paying less each month than they were before. If your mortage is your single biggest single Money saver so, rather than me going off on one here, explaining how amazingly different to other mortgage guides this is for a whole host of reasons, why don't we both just get on with it and save you some cash? Please note that the information in  this is correct at time of going to press, in September 2009. However, the motgage market is volatile so, while the vast bulk remains unchanged, always double check before acting.

Remortgaging means shifting your mortgage from one lender to another to get yourself a better deal. And you don't even have to move house to do it. In recent years around a third of all home loans were actually remortgages as  millions of canny borrowers took advantage of the UK's hugely competitive mortgage market. There are many reasons why remortgaging made sense for them an could make sense for you but the main one is  simple. Saving money big money. For most people, their mortgage is their biggest financial commitment. And it follows that streamlining the largest debt can produce the largest saving. If you're the kind of person who shops around to get the cheapest television or DVD player then you're missing a trick by not using the same skills to save money on your mortgage.

 

 

However, by September 2009, the economic crisis meant interest rates had reached record lows.Many standard variable rates, the rate most mortgages revert to after a discount period, were rock bottom too.For some, sticking on the SVR is the best option a previously unthinkable scenario. If you're considering this, ensure remaining on that rate is an active choice rather than a lazy one as, otherwise, you may find you've missed out on a fortune. So before you go anywhere, challenge your current lender to give you a new offer. Remember, it makes money from your debt so it does want to keep your custom.
 

Why should I remortgage?

 

If you do need to move,remember, although remortgaging can save you money, it does so at a price. In fact, as mortgage interest rates have dropped, the fees lenders levy have increased significantly. You may have to pay an exit fee to leave your current lender and, depending on your deal an early repayment charges as well. you may have to pay
an arrangement fee to join your new lender and face legal bills too. If you use a mortgage broker to help you find a new deal some of them may charge too. This doesn't mean you shouldn't remortgage. Normally the savings will still be huge-but it does mean you should do your sums before taking the plunge.

The lack of available borrowing, due to the credit crunch, means lenders have become more selective in who they lend to, to ensure they deem to be the best customers get priority. Those seen as better customers are those with large deposits and with spotless credit histories. In other words, where as once lenders were salivating with glee at the thought of lending to anyone and everyone, and would throw money out there, now their fists are tightly clamped around every penny. In the old days, good deals were shockingly available for those who were borrowing up to 125% of their home's value. Now that's  changed and by September 2009 you needed a 25% deposit to stand a chance of  getting a decent mortgage.