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Re-mortgaging explained

Re-mortgaging explained

If you are thinking about changing your mortgage lender to get a cheaper deal, or to cash in some of the equity built up in the property, you will have to re-mortgage your property. In this guide you can read about the remortgaging process and what to expect from each step.

1

Consider why you want to remortgage

There are many reasons why you may want to remortgage their property. Many choose to remortgage to reduce their monthly repayments, particularly if they are coming to the end of a short-term deal. You may also choose to remortgage to:

  • Get a predictable repayment plan by switching from a variable to fixed rate
  • Switch to a more flexible mortgage
  • Consolidate debt into one loan
  • Release equity if your property has risen in value since taking out your current mortgage

2

Find a deal

A mortgage adviser or financial adviser will be able to help you find the best deal, consider your lifestyle and needs and give you an idea of how much you can save. This is often one of the largest sums of money you will ever borrow, so taking advice from an experienced expert can be very useful.

It is normally a good idea to give your current mortgage provider a chance to match the terms of the new mortgage deal you and interested in pursuing. Although their advertised rates may be different, they may come to a deal to keep your business.

3

Make the application

If you have chosen to make an application to a different mortgage, either you or your mortgage adviser will submit the application with the lender and start the process.

4

Instruct a Conveyancer or Solicitor

To handle the legal side of the transaction, a solicitor or conveyancer is needed. The solicitor will send you an introductory package that is used to collect all the information about your property and mortgage as well as an instruction form and terms and conditions. The solicitor will also verify your identity and obtain title deeds from the land registry.

If you have chosen to use a mortgage advisor throughout the process, they can sometimes liaise with the conveyancer on your behalf.

5

Receipt of Mortgage Offer

The lender should send the mortgage offer directly to your solicitor as well as you, however it is best to send a copy to the solicitor just in case. At this point, there can searches of the property and solicitor will find out how much is left to pay on the old mortgage via an Initial Redemption Statement.

When a completion date is set the solicitor will formally report back to the lender, send you a mortgage deed to sign and request funds from the lender.

6

Completion

To finalise the remortgaging process the amount left on the old mortgage is reconfirmed and agreed. The original mortgage is then redeemed, and the residual balance forwarded to you.

7

After completion

The lender’s information will be registered on the land registry to indicate that the mortgage will be paid off before you receive sale proceeds. In addition, you will receive written confirmation of the monthly payment amounts and the dates of payment going forward.

Real Legal

Office 5
Empire Business Centre
2 Empire Way
Burnley
BB12 6HH

Authorised and regulated by the Solicitors Regulation Authority.

Real Legal Ltd, a company registered in England and Wales with number 12061875 and SRA number 663663.

Registered office: Suite 5 Empire Business Centre, 2 Empire Way, Burnley, BB12 6HH

Trading office: Suite 5 Empire Business Centre, 2 Empire Way, Burnley, BB12 6HH

Directors: Claire Stewart, Catherine Gavin and Kimberly Holgate.

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