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When it’s Time to re-look at Your Mortgage

The mortgage market is as busy as ever, and we have been receiving a lot of remortgage enquiries stemming from recent interest rate rises. The rate increases have caused concern for people looking for stability on their monthly mortgage payments, and as a result many mortgage borrowers are looking to see when they can start renegotiating their next mortgage product. Of course, a lot of people are looking at their overall outgoings with the cost-of-living increases, and the monthly cost of paying the mortgage is a huge part of this and is usually the starting point when it comes to household budgeting. It comes as no surprise that we have seen an increase in remortgage enquiries at this time.

Lenders have been playing their part in offering their clients a solution early, and we have had lenders recently alter the point at which they are able to offer new product rates to their clients. This means that we can review their options earlier and secure a new product before we previously would have been able to. As a general rule of thumb, if people are looking to find out when they can start looking at their options, we usually speak to our clients 6 months prior to their product fixed rate end date, as some lenders do enable you to secure a new rate this far in advance. Many mortgage offers will last for 6 months also, so this is the ideal time as it can enable options with alterative lenders to be considered alongside your current mortgage lender. This way, we can compare alternative products available and advise on the best route forwards, and it does usually provide enough time for the mortgage lenders and solicitors to complete their process.

Although re-securing rates and looking to save money is often the reason for remortgages, we do also receive many enquiries from people that have other plans. Where people are looking to raise capital from a property, they will often tie this in with their remortgage, so that they can secure this additional borrowing as one mortgage part with one product end date rather than have multi-part mortgages which are arranged on different products with different dates of rate expiry. Some of our portfolio buy to let clients have in the past used their mortgage review as a time to look to grow their portfolio. When we look to renegotiate their product, we will review the property value and mortgage outstanding, and if the client would like to look to add to their portfolio, there may be a potential option of raising capital from the subject property which can then be used as a deposit for an onward purchase.

Another popular reason for remortgaging is to repay a Help to Buy equity loan. The Help to Buy scheme is a popular way that many have purchased new build properties with the assistance of an equity loan from the government. When revisiting clients on this, we have looked at the potential of raising capital from the property in order to repay the equity loan, and again when a mortgage product is due to expire it can be an ideal time to consider this possibility.

There are many options when remortgaging, and the point that your rate is coming to an end is a real opportunity to review your entire situation and see what options are available to you. Rather than just select a new product, the remaining mortgage term and monthly payment should be

considered, as well as your wider financial situation and insurance arrangements. A lot can be gained from paying attention to these areas and conducting a full review, so the advice to all clients is to diarise the point to take some time out to review your circumstances and try not to leave it until the last minute. We do contact all of our clients in advance of their residential or buy to let mortgage product coming to an end in order to arrange this review which can be a real additional benefit of working with a broker to keep on top of things.

Your property may be repossessed if you do not keep up repayments on your mortgage.

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