Thinking About Remortgaging? We’re Here to Help You Make the Right Choice

Remortgaging can be a smart financial move, but with so many options out there, it can quickly become overwhelming. Whether you’re looking to secure a better interest rate, release equity, or reduce your mortgage term, it’s crucial to understand if remortgaging is the best fit for your financial goals. At The Mortgage Store Cheltenham and Gloucestershire, we’re here to guide you through every step.

What is Remortgaging?

In simple terms, remortgaging means switching your current mortgage to a new deal, either with your existing lender or by moving to a different one. This allows you to potentially save money, access better terms, or release cash tied up in your property. Remortgaging applies to both Residential and Buy-to-Let properties.

Common Reasons to Remortgage:
  • Secure a Better Interest Rate: Lock in a lower rate to reduce your monthly payments.
  • Release Equity: Free up cash for debt consolidation, home improvements, or other investments.
  • Shorten Your Mortgage Term: Pay off your mortgage faster and save on overall interest.
Benefits of Remortgaging

One of the main reasons people choose to remortgage is to secure a lower interest rate, especially when their fixed-rate period is coming to an end. But there are plenty of other benefits, such as:

  • Borrow More: Need additional funds? Depending on your loan-to-value (LTV) ratio, remortgaging could allow you to borrow extra for home improvements or even buying another property.
  • Debt Consolidation: Roll existing debts into your mortgage for easier management and potentially lower interest rates.

Switch to a More Flexible Mortgage: Choose a mortgage that better suits your current financial situation, whether that’s a fixed rate, tracker, or offset mortgage.

Understanding Loan-to-Value (LTV)

The amount you can borrow is often capped based on your property’s value. The higher your property’s equity, the better the terms you might be offered.

Downsizing or Let-to-Buy: Another Reason to Remortgage

If you’re planning to downsize or convert your home into a rental property, remortgaging can release the equity needed to purchase a new home while keeping your current property as an investment. This is a popular option for those looking to grow their property portfolio.

When is the Right Time to Remortgage?

Timing is everything. Ideally, you should start exploring remortgage options about 6 months before your current deal ends. This is especially true if your mortgage is approaching the lender’s standard variable rate (SVR), which can be significantly higher than introductory rates.

However, be mindful of early repayment charges (ERCs) if you’re thinking of remortgaging before your fixed term ends. If the potential savings outweigh the penalties, it might still be worth it to switch.

Should You Remortgage Now?

If you’re wondering whether now is the right time to remortgage, it’s essential to consider your current rate, any exit fees, and how much you stand to save. With interest rates subject to change, locking in a lower rate sooner rather than later could save you a significant amount over the term of your mortgage.

In some cases, you can remortgage after just six months of owning your property. This could be an option if you’ve inherited a property or are buying out a family member.

How Often Should You Remortgage?

A common myth is that you should remortgage every 2 years, but this depends on the length of your fixed-rate period. While a two-year fixed rate is popular, longer terms of 3, 5, or even 10 years are available. Remortgaging whenever your introductory rate ends can help you avoid higher SVR rates and secure better deals.

Always review your mortgage options as your fixed rate ends to see if switching to a new deal could benefit you.

Discover If Remortgaging is Right for You

Not sure if remortgaging is the best choice for you? Our team at The Mortgage Store Cheltenham and Gloucestershire is here to help you explore your options. We’ll assess your situation, compare deals from across the market, and provide tailored advice to help you make an informed decision.

Get in touch with us today for a free consultation using the form above, and let us find the best mortgage solution to fit your needs. Your dream home or financial freedom could be closer than you think!

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