Where To Remortgage (Saving Time And Money)
11th January 2017
To find a new mortgage, you can use a comparison website or go to a mortgage broker. You may also want to check what your existing lender can offer. One of the best ways to remortgage is to use an online broker like Trussle, which can help you secure the right mortgage conveniently online.
Deciding to remortgage
When you reach the end of your initial mortgage deal, you’ll be moved onto your lender’s Standard Variable Rate (SVR), which usually means your monthly repayments will increase.
Before this happens, it’s a good idea to think about remortgaging, as you can usually save money by getting a new mortgage and returning to an introductory rate. There’s more information about this in our article, When To Remortgage (And When Not To).
It’s important to bear in mind that lenders don’t sell specific ‘remortgage’ products: remortgaging is simply the process of taking out a new mortgage to pay off your old mortgage. This means that you have a wide range of options to choose from, just like when you first took out a mortgage.
Here are a few ways you can search the market to compare remortgage deals and find the best remortgage rates.
Asking what your existing lender can offer
Your existing provider may be keen to keep you as a customer, so there’s a chance they’ll offer you a competitive deal. But be sure to compare any offer with other mortgage deals on the market.
Trussle mortgage adviser Deeksha Shah says: “The mortgage market is as competitive as it’s ever been, so it’s really important to shop around. Speaking to just one lender will severely limit your options and could mean you’ll miss out on a much better deal.”
Using a comparison website to find remortgage deals
There are several comparison websites that you can use to search for a new mortgage. Once you’ve entered a few basic details, they will usually present you with a side-by-side comparison of several remortgage deals, including the name of the provider, the type of mortgage, the interest rate, and the fees. If you choose one of these mortgage deals then you’ll usually be redirected to the lender’s website where you can make your application.
These sites can be useful for getting an overview of what’s available, but they can’t tell you which mortgage deal may be best for you, and they won’t help arrange your mortgage.
Using a broker to find remortgage deals
Another option is to use a mortgage broker to find a remortgage deal. Qualified brokers are mortgage experts, who know the market well and can look for deals depending on your specific needs.
However, some brokers only consider a limited selection of lenders, and some lenders don’t offer mortgages through brokers, so you may not get access to all the deals available. Using a mortgage broker can also be expensive, as some will charge a fee.
Using an online broker to find remortgage deals
Alternatively, you can use an online broker like Trussle to find a remortgage deal that works for you. At Trussle we’ve developed powerful search technology to find a suitable mortgage product five times faster than traditional mortgage brokers; simply enter a few details online and we’ll search over 11,000 mortgage products from over 90 lenders to find you a suitable deal. We’ll then manage your application every step of the way. Once your mortgage is in place, we’ll keep monitoring the market for you, and let you know as and when you could benefit from switching.
Comparing remortgage deals
When you’re looking at possible mortgage deals, these are some of the things you’ll need to bear in mind.
The mortgage deals you’re offered will depend partly on your loan-to-value ratio (LTV), which is the percentage of the property that is being paid for by the lender.
For example if your property is worth £200,000, you bought it with a £40,000 deposit and you’ve already paid off £10,000 of your mortgage, you’re now borrowing £150,000. This means your LTV is 75%.
Fixed vs. variable rates
You can choose a mortgage with a fixed interest rate for predictable payments, or a mortgage with a variable interest rate if you’re happy for your payments to go up and down according to the financial markets. There’s more information about this in our article, How To Remortgage.
Two, three, five or 10 year fixed
You can also choose how long you want your mortgage rate to be fixed for, with lenders offering two, three and five year fixed options, and some even offering 10. If you’re likely to sell your home in the next few years, going for a shorter fixed term may be the better option; if your mortgage is still fixed when you want to move, you may have to pay an early repayment charge.
If you’re likely to be staying in your home for a while, you may choose a longer fixed term so that you’ve got the security of knowing how much you’ll pay each month. Bear in mind though that you tend to pay for this security, as longer fixed rates are usually higher than shorter fixed rates. Meanwhile, variable mortgages are often the cheapest of all when you look at their initial rate, although the rate will fluctuate making future payments unpredictable.
Fees and restrictions
Remember that when you’re choosing a mortgage deal, it’s important to look at other aspects of the products as well as the rates. For example, look at the fees charged by the lender and the mortgage’s rules and restrictions.