Are you currently looking to remortgage your property ? If so, the main reason is likely to be that you want to save money. Remortgaging is the process of paying off what you currently have left on your property’s existing mortgage with a new one.
If you would like a better rate, your current deal is about to end, you are concerned about interest rates increasing, you want to borrow more, you want to overpay but your lender won’t allow you to, or your home value has risen significantly, these are also reasons you may be looking into it.
However, before you remortgage your home, it’s vital that you know all the dos and don’ts. Here are some top tips on how to remortgage your property while avoiding expensive mistakes.
Do Shop around for the best options available
If you are someone that shops around to find the latest deals on electronics or insurance, you should use these same skills to save money on your mortgage, too. Comparison sites won’t all provide you with the same results, so ensure that you use a number of them before making a decision.
Prepare your necessary paperwork in advance
When it comes to remortgaging, there can be a lot of paperwork. The sooner you get all your documents together – ID, proof of income, proof of address and bank statements – the better. Once you have gathered them, keep them safely in one place, so that you can access them easily when you need to.
Check your credit score
Your creditworthiness plays a huge part in whether you are going to be accepted for a mortgage. If possible, you should start to manage this a year in advance. It’s essential that you never miss a repayment on anything. Also, in the few months before you get a mortgage, try not to apply for the likes of a credit card or new mobile phone contract unless it’s absolutely necessary.
Remember the affordability checks
Affordability checks apply for remortgaging, too. Lenders will look at whether you can afford the mortgage you are looking to get. They may look at old bank statements to see how much room you have got, so if that might be a problem, it’s worth being thrifty before you remortgage.
Don’t Forget the fees
Remortgaging fees can be high these days. Sometimes, they can even be thousands of pounds. Before making any big decisions, ensure that you have considered all your financial options. Prepare yourself for being charged with terminating your contract early if you are still within your fixed-term period. Also, bear in mind the set-up fees from your new lender, as well as fees for the legal work that it requires when remortgaging.
Stay with your current lender for ease
Although the thought of remortgaging might be daunting, there are many benefits to it. You may be able to save yourself a lot of money every month, but your current lender may not be the cheapest, so don’t be scared to go elsewhere.
Guess your property’s value by yourself
A correct valuation of your property is vital, especially in circumstances such as wanting to release equity. You will need an accurate valuation to know how much to spend or save with your new mortgage, so don’t try to guess it yourself.
