Hey there, fellow homeowners! If you’re looking to get the most out of your mortgage, a remortgage could be the secret sauce you’ve been searching for. But, hold on a sec! Before you dive in, let’s take a leisurely stroll through the ins and outs of the remortgage process. In this blog, we’ll dish out the deets on what a remortgage is, when to start thinking about it, and the factors that could potentially put a kink in your remortgage plans. So, grab a cuppa and get ready to become a remortgage guru!
What Exactly is a Remortgage?
Picture this: You’ve got an existing mortgage, but you’re itching to make some changes. A remortgage (or refinancing, if you want to get fancy) is all about swapping out your current mortgage for a fresh new one. It’s like hitting the reset button on your mortgage terms. The beauty of it all is that you can potentially snag better rates, lower your monthly payments, or even get your hands on some extra moolah for those home improvements you’ve been dreaming about.
When Should You Start Remortgage Planning?
Timing is everything! While there’s no one-size-fits-all answer, it’s wise to start contemplating a remortgage a few months before your current mortgage deal comes to an end. Most mortgage products have a lifespan of two to five years, so six months before that finish line is a good time to start your planning.
Why the early start, you ask? Well, it gives you plenty of breathing room to do your homework. You can scout different lenders, compare interest rates, and most importantly, seek mortgage advice. Critically, you can secure a mortgage product early before the interest rates increase. And you’re not scrambling at the last minute, and you’ll have ample time to gather all the necessary paperwork and pass any financial assessments with flying colours.
What Might Throw a Spanner in Your Remortgage Plans?
Ah, the unexpected hurdles that life likes to throw our way! When it comes to remortgages, a few things can potentially slow down the process. Let’s break them down so you can prepare yourself and keep your zen intact.
- Diving into Mortgage Advice and Research: If you want to smoothen your remortgage journey, reaching out to a knowledgeable mortgage advisor is a smart move. However, bear in mind that scheduling consultations and diving deep into research can eat up some time. But hey, it’s worth it to make informed decisions and uncover the best remortgage deal that suits your fancy.
- Early Repayment Charges (ERCs): Before you set sail on your remortgage adventure, take a moment to check if your current mortgage deal has any Early Repayment Charges (ERCs). These sneaky charges are designed to keep you tied down, discouraging you from leaving your mortgage early. ERCs vary from lender to lender and can put a dent in your plans. So, make sure you crunch the numbers and figure out if the potential savings from a remortgage outweigh the charges.
- Property Valuation and Legal Jazz: Just like the first time you got a mortgage, a remortgage requires a property valuation and some legal work. Unfortunately, these steps can sometimes take longer than anticipated. A sluggish property valuation or unexpected legal complications can delay your plans. To keep things moving smoothly, partner up with professionals who know their stuff and prioritize efficient service delivery.
- The Economy Playing Tricks: Ah, the unpredictable world of economics! Sometimes, external factors like interest rate fluctuations or changes in lending criteria can cause bumps along the road. Keep an eye on what’s going on with interest rates and make sure that you use a mortgage advisor who is willing to keep track of your product and switch you onto a better rate if needed right up until your new mortgage kicks in.
Alright, folks, we’ve reached the end of our leisurely stroll through the remortgage maze. So, what have we learned? Planning ahead and staying on top of things is key to navigating the remortgage process like a pro.
By starting your remortgage musings six months before your current deal expires, you’ll give yourself ample time to explore your options, seek advice, and compare those interest rates. Remember to keep those pesky Early Repayment Charges in mind and evaluate whether the potential savings outweigh the fees.
Sure, there may be a few obstacles to get passed, like delays in property valuations or unexpected legal hiccups. But fear not! By teaming up with experienced professionals, you’ll breeze through those hurdles in no time.
And let’s not forget about the unpredictable dance of the economy. Interest rates may shimmy and lending criteria may cha-cha, but that shouldn’t discourage you. Stay informed, adapt, and keep your eyes on the prize.
Hudson Rose are a team of experienced mortgage advisors with over 16 years of experience, helping people to sort their remortgages. Give them a call today or book in for a chat to understand more about your options.
And while you’re here, check out more handy blogs from the Hudson Rose team!