Remortgage With No Broker Fee To Pay

Remortgages In A Nutshell

Remortgaging is simply the act of moving your mortgage from one lender to another. Why bother to remortgage?. Quite simply, to save you money.

When you come to the end of your current mortgage deal it is usual practice for the lender to move your borrowing onto their current Standard Variable Rate (SVR). Most SVR’s are pitched somewhere around 2% above current Bank Base Rate which can mean a hefty rise in your monthly repayment. Some lenders will offer you a new deal but this is rarely their best rate. The lender is looking to make money - you should be looking to save it… as much as possible over the term of the mortgage.

Remortgage? It’s a hassle…i haven’t got time…
That’s music to the ears of your lender – and it’s time for a different tune. Remember, we’re here to save you time and money. We carry out a mortgage review with all our customers to ensure we give the correct advice, but after that – and with your consent - we can see to nearly everything required in an endeavour to get you a better deal.
The traditional timescale to complete a remortgage is 4-5 weeks, less with some technology driven lenders, so in a very short time you could be saving money.

Remortgage? What’s it going to cost?
Well, using Mortgage of Choice to arrange the remortgage won’t cost you a penny as we’re a no-fee broker – that’s a saving right from the outset.
Many lenders will offer incentives such as a free basic property valuation and /or free standard legal work on remortgages. Some remortgage products carry no fees whatsoever but the interest rate will generally be slightly higher.
We will look at the merits of paying a lender Arrangement Fee to determine if this provides better value over the incentive period.

Remortgage…still not convinced?
Let’s put some hard figures down on paper to show the effect of coming off a fixed rate and languishing on the lender’s standard variable rate:

Mr & Mrs Borrower have a mortgage of £100,000 on Interest Only.
Current product = 2 Year Fixed Rate at 5.75%
Monthly payment = £479.17 per month

2 Year Fixed Rate ends and borrowing reverts to lender’s SVR = 7.75%
New monthly payment = £645.83
Increased monthly cost = £166.66 x 12 = £1999.92

That’s a £2000 per year expense that could well be saved by a simple remortgage.
If Mrs Borrower works part time for £2000 per annum she’s working for nothing!

Debt Consolidation
On remortgaging, many customers decide to incorporate other credit commitments into the mortgage to ‘tidy up’ their finances, i.e. feel more comfortable with one major monthly outgoing rather than a spread of varying payments at different parts of the month.
Whilst there will be many situations where this makes practical financial sense, two important considerations must be stressed:

• Personal loans, credit and store cards etc are unsecured debt - non payment of these commitments will damage personal credit rating but does not put your home at risk. Consolidation of these borrowings into the mortgage makes them secured debt – repeated failure to meet the increased mortgage payments will not only damage credit rating but also put your home at risk of repossession.

• Personal loans and cards are deemed to be ‘short term borrowing’, although this is often debateable where only minimum payments are made on credit cards. Consolidation into the mortgage will make these ‘long term borrowing’, consequently your monthly outlay may have reduced but more interest will be paid overall.

This is where our regulatory mortgage review with customers pays dividends – we look at individual circumstances and budget and recommend the most cost effective way forward. Consideration could be given to other options:

• Flexible mortgages where additional / increased payments shorten the term over which interest is paid
• A limited number of lenders offer split term mortgages – the consolidated amount put on a shorter term to lessen the interest payable
• Use of a Secured Loan on a shorter term than the main mortgage. Interest rates are higher but less overall interest may justify this route.

Sometimes further borrowing is not the answer. In times of financial difficulty it may be possible to negotiate different payment terms with creditors rather than consolidate / convert to fully secured debt. Please see Debt Management

Remember, in addition to finding the most beneficial remortgage Mortgage of Choice will not charge you a broker fee – that’s a saving right from the outset.

CAN WE HELP TO SAVE YOU MONEY WITH A SIMPLE REMORTGAGE?

0800 988 1889  enquiries@mortgageofchoice.co.uk Enquiry Form

Please think carefully before securing other debts against your home. When consolidating debts the new mortgage may have a longer repayment term and therefore increase the total amount payable.