When we think of remortgaging a home it is usually in the light of choosing to make major changes – but the best reason to remortgage could actually be to get a better rate.
A mortgage is usually the biggest financial commitment most people ever take on, often stretching to 30 years.
With the long payment plan comes lower interest rates than might be found on high street loans.
As a result of the repayment framework being in place, many people choose to add the cost of substantial renovations to their home onto their mortgage.
Extensions, conservatories, loft conversions – or in some cases major repair works – are often added to a mortgage.
While obviously pushing up mortgage payments, such work as a general rule will add to the value of the home making the investment worthwhile.
Remortgaging to secure a lower rate
But remortgaging is not only about house alterations, it may in fact be the case that remortgaging could help homeowners to secure a better rate on their mortgage – or to negotiate different terms.
There are a number of different factors that could come into play when deciding whether to remortgage your home.
One factor that holds some considerable sway is if the value of your home has risen considerably. A higher value will give you a better loan to value ratio, which could result in lower rates on your mortgage.
Another reason to remortgage could be a change in circumstances if one of you is earning more money therefore putting you in a position to repay the mortgage over a shorter time.
Similarly if you find you have an adequate income and are in a position to overpay on your mortgage to bring it down quicker you may want to remortgage to a deal where this is possible (if it is not already).
Work out savings
With interest rates susceptible to change there is also the possibility that you may want to switch mortgages to secure a better rate.
If you think that you may be better off by remortgaging your home, take some time to work out how a deal could work for you then seek the advice of a professional.
Using a solicitor will help to ease the legal and administrative burden of remortgaging – for more advice get in touch with Anthony Stockton Solicitors.