What Is Remortgaging?
Remortgaging is switching your existing mortgage to a new lender, sometimes simply to cut costs, but there are other reasons to think about remortgaging:
- Debt consolidation
- Home Improvements
- Capital Raising
- Other Investments or purchases
- Purchasing a Buy-to-Let Property
- A Divorce Settlement
- Fixing the interest rate
- Offsetting current/savings accounts
How Much Will It Cost?
Paying Off Your Existing Lender
Your current lender will probably charge an administration fee, usually from £100-£300 for the administrative costs of paying off your mortgage.
In addition, they may make an Early Repayment Charge. This is a financial penalty that you may incur for moving your mortgage away from them while you are still in a concessionary rate period, i.e. fixed, capped, discount, tracker etc.
These penalties can run into hundreds or thousands of pounds, and if you are still within such a penalty period, it may be uneconomic to move your mortgage until the penalty period has expired.
Legal Fees
A new lender will require you to spend a few hundred pounds on legal fees in arranging your remortgage. However, some will pay these costs for you as an incentive for you to move your mortgage to them.
Valuation Fees
The new mortgage lender will want to satisfy themselves as to the condition and value of your house. This involves a valuation or survey fee, which again, some lenders will pay for you.
Application or Product Reservation Fee
This is a fee charged by a lender for a special mortgage scheme, i.e a fixed, capped, discounted or tracker rate.
Fees can vary dramatically and may be hundreds or thousands of pounds, although the average lender will add them on to the mortgage. Application fees can nevertheless completely compromise the economics of moving the mortgage.
Adverse credit
The overall cost for comparison is 8.90%. The actual rate will depend on your circumstances. Ask for a personalised Illustration.
We do not make a charge for an initial consultation.
