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Remortgaging – What you need to know | Bespoke Mortgage & Finance Centre
When do I need to think about remortgaging?There are two typical reasons to look at a remortgage. First, because your current mortgage deal is coming to an end and you want to see what else is available. Second, you might be looking to move home in the near future and are considering taking your mortgage to the new property.
What happens at the end of a fixed rate deal?A fixed rate mortgage might last for two, three, five or even 10 years. When it ends, you automatically switch to the lender’s standard variable rate – which could push your repayments up considerably. You can nearly always save money by shopping around and switching to a new mortgage. It might be another fixed rate deal or a more competitive variable rate mortgage.
How does remortgaging to buy a new home work?Perhaps you’re planning to buy a new property in the next year or two. If so, remortgaging can help you achieve your goals. If you’ve paid off a decent amount of your current mortgage you can access the equity by remortgaging, and then use it as the deposit on the new home. Also, by choosing a ‘portable’ mortgage you can seamlessly move it across to the new property. Exactly what you choose and how it works will depend on your specific situation, so it’s worth exploring the options early on.
Why use a mortgage broker rather than going direct?You can simply go to your existing lender, but they will only offer you their own products, so it’s harder to tell if they are good value or not. A Mortgage Broker looks at many lenders to find the best remortgage deal based on your circumstances and plans. You will also build a good relationship with your Mortgage Broker – we get to know you and provide long-term support, so we can make tailored recommendations for your specific situation.
What’s the remortgage process with a broker?First we complete a financial fact-find to understand your income, your budget, your current payments and anything else that’s relevant. We look at your personal circumstances and future plans. This knowledge helps us do a remortgage cost comparison, with the first step to see what your existing lender is offering you to stay with them. We then explore what other lenders will offer you. There are costs involved when you’re looking to remortgage, so we will carefully account for these and any other fees and offers. Free valuation, free legal and cashback are all common incentives. Once we’ve narrowed down the options, we get an offer in place ready for when your current mortgage ends.
What happens if interest rates change between getting the offer and starting the new mortgage?We typically start talking to customers six months before the end of a mortgage deal. Most mortgage offers are valid for three months, so we would complete all the research in plenty of time and lock in a deal. If mortgage rates increase it won’t affect you, because your offer guarantees the original rate. Meanwhile, if the rate with your prospective lender goes down, we will go back and request a new offer at the lower interest rates. This is a real benefit of using a Broker. If you went direct to your bank they may not contact you to let you know about a rate change. At Bespoke we check interest rates all the time to get the best deals for our customers. We love to make sure every customer is getting the very best from their mortgage deal.
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