Remortgaging is the process of obtaining another mortgage on your property. You may want to remortgage for a number of different reasons, whether it be the relationship with your current lender breaking down, or another lender is offering really good joining bonuses. Ultimately it’s a great way of potentially saving thousands of pounds (a year) on repayments of your mortgage. It usually occurs when the mortgage plan has come to an end, but there might be some significant reasons to remortgage during a fixed term product.
Let’s talk about some ways to save our money by remortgaging.
New mortgage deal
Get a mortgage of lower interest rate: One major reason most people choose to remortgage their home is to get a lower rate than they’re currently paying. You can negotiate your new deal. Remortgaging enables you to negotiate a new contract with your existing lender or a new lender effectively. Once you don’t discuss a new renewal and stick with the previous contract, you’ll find yourself always at the lender’s regular lending APR rate, which is usually not as competitive.
Cheaper than a standard credit card
Remortgaging a home have lots of advantages if, for instance, you chose to install a new kitchen, then obtaining a remortgage (and adding the kitchen cost to the mortgage) could mean that lending is cheaper compared to a standard credit card with a typical interest rate of 20%. It’s a good idea to check other mortgage providers so you can be sure your new mortgage rate is competitive.
Another major way to save by remortgaging is to over-pay. You can ask your lender if it’s possible to make payments every 14 days (instead of once a month), or you can also decide to add 10 percent to the payment of each month and ensure that the bank adds it to the principal. Doing this little alone can enable you pay your loan in about 24 years rather than 30, which could help you save thousands of pounds.
Let’s save some serious money!