Getting A Remortgage: Steps To Remortgaging In The UK

July 29, 2021 by in category Mortgage Advice tagged as , , with 0 and 0

Like a mortgage, remortgaging is also a common practice in the UK for various reasons. One common reason is to prevent the Standard Variable Rate (SVR), whose interest rate is almost always higher. People also go for it:

  • To increase borrowing to free up cash for other more significant expense
  • To reduce monthly repayments
  • To overpay than current payment to pay off the mortgage
  • To fix payments to avoid the uncertainty of monthly mortgage outgoings

Other possible reasons include a change in the base mortgage rate at the Bank of England and an increase in the property’s value.

No matter what makes you go for it, understanding the remortgage process is essential to avoid unpleasant surprises later.

How Does The Process Of Remortgage Work?

You need to consider a broader monetary situation to remortgage your house. Now, let’s see how to remortgage UK works.

Agreement In Principle (AIP)

Many mortgage lenders allow you to get an online Agreement in Principle (AiP), also known as a mortgage in principle. AiP helps you learn if a lender is ready to lend the money you require without conducting a full credit check. It is not necessary to select a specific remortgage deal, and you may not be approved for a remortgage, but this step will help you know your options.

Cost Consideration

Find out if the lender you plan to move will charge any of the fee mentioned below:

  • Application Fee

It is a fee for setting up the new mortgage deal.

  • Valuation Fee

This fee is a charge for confirming your property value.

  • Solicitor’s Fee:

Since a solicitor is always involved, it is charged for transferring mortgage payment.

  • Exit Fee

Lenders may also charge an exit fee to allow you to get a remortgage plan.

Cost Comparison

You should look around to see the available options before your present mortgage is going to end. In this way, you can have a clear picture of it and to which lender you should move for a new deal.

Apply For New Mortgage

Having had the AiP, you are all set to apply for a remortgage. You will be asked to share your information relating to:

  • Your personal circumstances
  • Your financial circumstances
  • Your present mortgage

Be prepared with all the necessary documents to prove your earning and any other loans you have. Having your documents ready will speed up the process. The information includes:

  • Bank statements and credit card statements
  • Payslips
  • Utility bills
  • Address
  • ID (driving license or passport)

Completing Remortgage

To complete the remortgage process, the lender will perform a credit check to confirm your current financial condition and your property’s valuation. At this stage, a solicitor will be required for the mortgage transfer. You can also ask the lender for it since lenders often give this service free of charge.

Period for Remortgaging

It usually takes from 18 to 40 days from submitting the application to getting the mortgage offer. Following this guide to remortgaging will undoubtedly help you save a great deal of money and obtain the best possible deal on the market, always.

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