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When Can I Remortgage?

The ultimate question: ‘When can I remortgage?’. Luckily, MO’s got the answer.

If you’ve got a mortgage that you’ve had for a couple of years you should be looking right this instant at whether you can start saving money. Remortgaging can seem like choppy waters to tread, but the truth is, it shouldn’t be. This article will show you when you should start looking at remortgaging, so you can find the best deal for yourself and start saving cash.

Remortgaging can often be seen as a dirty word for many. Largely associated with financial security, it has become something of a taboo, something to be embarrassed by. But the real question lies with the why. For most, there’s a likelihood that your mortgage is your biggest financial commitment. And just because of the vast sums involved, you shouldn’t be intimidated.

Remortgaging can be a great way to save money in the region of thousands of pounds. If you’re someone who likes to be frugal when it comes to savings, why not take the same ethos here? Remortgaging can be a great outlet for this. If you know its rigors and where to look it can be an easy way to save money. Though, before you start looking at remortgaging, you’ll need to know when you should start looking to do so and how to get the best deals. Here’s how:

Crumpled paper

Introductory rates:

So, if you’re looking at remortgaging, there’s a possibility that you’ve had some very sad news recently, and that is, yes, you’ve guessed it, the conclusion of your introductory period (usually for those on tracker and fixed rates ). For those of you that don’t know what an introductory period is, it means that for the first parts of your current mortgage loan, your interest rate will be lower in comparison to the lenders Standard Variable Rate. This can last for a range of time depending on what you select, but on average this tends to be between 2-5 years. This can be a great thing for most, particularly first-time buyers who are young or looking to start a family as it can provide security of monthly payments if there are any hikes in interest rates. 

The only problem is the jump in monthly mortgage payments that homeowners can see when they move from their introductory rate to their lender’s Standard Variable Rate (SVR), which can sometimes leave a negative financial impact on homeowners.

The sudden hike can potentially add hundreds of pounds to your monthly payments following the end of your introductory rate which could lead you having to make significant cuts to your own expenditure and way of living. Best way to prevent this? Remortgage!

Don’t waste time:

As I’m sure you’d agree, where money is concerned, time is precious. You should ideally start looking at remortgaging a few months before the end of your introductory rate, so you can save yourself additional stress and most importantly, cash, by jumping onto a new deal as soon as your previous one ends. A standard remortgage takes, on average, 2 months to complete, so applying for a new mortgage 3 months ahead of your end date is best. Be proactive and get planning!

We recommend that you keep an eye on your monthly committed payments which could potentially affect your affordability and know exactly when your introductory period ends so that you can plan in advance and diarise your remortgage. As said, applying for a new mortgage 3 months ahead and being aware of your end date is important so that you can start the comparison and research process in advance and allow yourself enough time to weigh up all of the options that you have at your disposal. 

While you may be nodding to yourself as you read this saying ‘yeah, I can plan, I. CAN. DO. THIS’ it’s important to be vigilant. Any time spent on SVR can cost you a lot of money. But, don’t forget, it’s also important to be aware of any repayment fees which could be thrust upon you for paying off your old mortgage within your introductory period.

Find the cheapest possible mortgage as a point of reference:

There are a number of comparison sites that’ll help you find the cheapest mortgage but might not factor in your eligibility for the mortgage itself. Don’t be afraid to use comparison sites that include direct-only deals i.e. ones that aren’t solely available to mortgage brokers, this can be an excellent way of saving money if you feel confident of doing your own research into the best deals. However, the only real way you’ll find the cheapest, but best suited and mortgage you meet the criteria for, is by using a broker.

Affordability & Credit History:

You also need to factor in that lenders will need to carry out affordability checks. A lender may request to see your payslips, bank statements and various other income related documentation to confirm what you are saying you earn is true. Your credit history will also be taken into account with your affordability to ensure the lender is satisfied that you would be able to repay the loan over the term you have selected. The way in which lenders check your credit score and affordability differs between lenders. The easiest way to keep a good, strong credit score is to make sure that all your monthly committed payments (mortgage, loans and all other direct debits) are paid on time every month. If you are unsure of what your credit history is like or what your overall score even is, request a copy of your credit file from a credit reporting agency.

Don’t forget the fees:

Don’t forget the fees involved either! Mortgaging fees can cost up to thousands of pounds, so don’t let this fall by the wayside (don’t forget however that some lender fees can be added to the loan and there are remortgage deals out there which offer free legals).

So, hopefully you’ve had your ‘when can I remortgage?’ question answered!

Use Mortgages Online to find the best mortgage deals and see if you can remortgage, and free up some cash! Get in touch with us today!


Laura Waller

Laura Waller has been working in the mortgages industry since 2013, joining an independent brokerage in Essex. Laura has CeMAP 2 & 3 – Certificates in Mortgages Advice and Practice. Since then Laura oversees marketing for Mortgages Online, using her experience and expertise to write articles and blogs about mortgages and related topics.

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