When it comes to mortgages, some people want to pay it off slow and steady over a long period of time, and some people want to get it all paid up as soon as possible. The one thing everyone has in common is wanting the best deal they can..
Remortgaging can help you with this, as it gives you the chance to review your mortgage product. You’re not locked into a mortgage forever, and you should ensure you always have the most competitive rate to suit your situation.
Does remortgaging take a long time?
The process of remortgaging doesn’t have to be long and drawn out. An experienced advisor or broker can take as little as five days to get an offer issued, and the completion of solicitor’s paperwork can take up to 4-6 weeks. If you’re involving a third party (for instance, Help to Buy or a Housing Association) then the process can take 8-12 weeks.
With this in mind, the process itself is more simple than you might think. It works in three stages:
Speak to your advisor to complete a fact find, or you can download and complete a fact find online here. This process will give the advisor an idea of where you stand financially by assessing factors such as your incomings and outgoings.
Then, you’ll need to supply relevant documentation to support the information gathered in your fact find. This includes:
- Passport (or another accepted form of ID)
- Proof of address
- Current mortgage details
- Payslips from the last three months, or accounts and tax returns if you’re self-employed
- Proof of any commission or bonuses
- Bank statements
The mortgage advisor will recommend your options, and you’ll discuss what your preference would be.
The mortgage advisor will complete a decision in principle with the recommended lender and then submit a full application. A lender will do a valuation (often remotely, without needing to go the property), and assess the documents needed for the application. If all is accepted, an offer will be issued.
Any legal paperwork is completed if it’s required and a date is set for the new mortgage product to be activated. If you’re remortgaging to pay off a Help to Buy loan or staircasing out of a Shared Ownership, there is an extra stage and the remortgage process will be longer due to the third party involvement.
If you are paying back a loan, you need to contact Help to Buy or the Housing Association to let them know that you want to repay the loan, so they can complete the paperwork in-house. You need to obtain a RICS valuation report to supply to them so that you both know the amount that is to be raised to repay them.
Read more about how remortgaging works here.
Why should I remortgage?
There are a lot of reasons why you might want to remortgage. This could be because:
- Your mortgage term has come to an end, and you’re about to be put onto a lender’s standard variable rate – which often is costlier
- You need cheaper monthly payments because of additional commitments
- You’re currently on a variable rate mortgage and you want payment stability
- You have received money and would like to pay a lump sum off your mortgage
It doesn’t just have to be about making your current mortgage suit your wallet better though. You can think of your mortgage like a loan against your house, and use it to raise funds for things like home improvements, buying a second home, or paying off debts.
Remortgaging makes perfect financial sense for many people, but it’s not worth remortgaging if you won’t save more than you spend on fees. Start talking to a broker up to six months before your fixed term ends if you’re curious about whether remortgaging would be right for you.
Our experienced advisors at Mortgage Light can help you figure out the best deal and the best way to make your mortgage suit your situation. If you’d like our advice on remortgaging, get in touch with us today. We have an experienced team of staff who can make remortgaging easy and help the process go smoothly. We’ll review your mortgage and your situation to help you make the right decision, so that your mortgage works for you.