Thinking About Remortgaging? Here are 5 Questions to Ask Yourself First
With mortgage rates at their lowest in years, the current property market is looking a much friendlier place to be – perhaps making it the perfect time to think about switching up your current mortgage deal.
However, if you are considering remortgaging, there are some questions you should ask yourself first ↓
Why am I Remortgaging?
There are usually two main priorities for homeowners deciding to remortgage; they either want to lower their monthly repayments or free up equity in their home. Whilst it is possible to achieve both, knowing why you’re remortgaging your home is key if you want to secure the best possible deal.
Remortgaging to reduce your outgoings is often the preferred option for those on their lender’s standard variable rate, as these rates can be higher than fixed or other variable deals. On the other hand, for those who have owned their property for some time and are in need of extra cash, it may be worth looking into what percentage of the property you now own and tapping into some of that equity. This could help towards any unexpected life events or even some much-needed home improvements.
How Much Can I Afford to Repay?
If your reason for remortgaging is to reduce your monthly outgoings, then selecting a deal that suits you now and in the future needs to be a priority.
Be thorough when going through your household budget, consider how much you will have coming in each month and write up a list of your entire outgoings. How much will you have left at the end of each month for your mortgage repayments?
What Type of Deal Will Suit Me?
When it comes to finding the right deal for you, the professional advice of a qualified mortgage advisor may help to save you money and provide you with peace of mind.
However, when selecting your mortgage deal, it will often come down to one key question – do you want a fixed or variable rate? Knowing which particular type of deal may work best for you will help to save you money in the long run.
If this is the route you do choose, then it’s also important to remember that interest rates are very difficult to predict and if they were to rise, you would still need to be able to keep up your monthly repayments.
Alternatively, if you’re looking more certainty, then you may prefer the predictability of a fixed mortgage. These may start out with a slightly higher repayment, but then you have the certainty that regardless of any changes to interest rates, your monthly repayments will remain the same for a fixed period.
…And If Fixed, How Long For?
If you are considering a fixed rate, then how long would you want it for?
Deals will more commonly be offered for periods of two and five years, however, there are other options available. More often than not, the shorter deals will offer lower rates, but it is worth remembering that these shorter terms do also mean that you’ll be back looking for another mortgage sooner rather than later.
What Are the Total Costs Involved?
Last but not least, remortgaging isn’t just about interest rates. You will need to consider the total costs of the entire process.
Additional fees can include an arrangement fee, valuation fees, legal fees – So when comparing mortgages, make sure you factor in all costs and take the time to understand the full amount you will be re-paying.
Need help remortgaging? Amber Mortgage Solutions will assign you an independent mortgage adviser with the expertise to find you the best possible deal.
So call us today on 01702 619221 or you can contact us through our website.
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