Yes. You can remortgage to potentially secure a better deal or to reduce your monthly mortgage repayments. Alternatively, homeowners may want to remortgage to make home improvements. It’s done as a way of acquiring additional funds for improving the property, ranging from decorating and light refurbishment up to extensions or building on your existing land. Remortgaging can provide the funds needed to ensure your dreams come true.
To save money when remortgaging your property, the lowest APR rate needs to be secured should you wish to receive a better deal. For instance, if two customers borrowed exactly the same amount of money over the same number of years and one is paying a rate of 2% and one of 4%, the 2% payments will be less. While they’ll both repay the same amount of capital, the homeowner with a rate of 2% will be charged less interest as their rate is lower.
There are a lot of clients who, once their initial rate has ended, then move on to a standard variable rate. Generally speaking, this will be higher than a new rate or new deal offered by many lenders when remortgaging. However, most lenders will cover some of the associated remortgaging costs, such as valuation or legal fees.
It’s always recommended, when remortgaging, to speak to a mortgage broker or mortgage advisor. For instance, we’re seeing an increasing number of clients who are spending money on various credit cards or loans with a view to adding the debt to the mortgage later and classifying it as raising money for home improvements.
Unfortunately, a lender will classify this as debt consolidation, and the rules and criteria regarding this are much stricter, and not everyone will be able to do this, if at all. As such, it’s important for you to plan what you may want to do, even if you're not ready right now. No matter how simple or complex your situation might be, from straightforward switches to more complicated issues, mortgage advisors are best placed and highly trained in securing the best mortgage rates possible, and that’s definitely true of ours here at View Finance.
Generally speaking, most lenders are happy to lend money for home improvements. Whether you’re decorating, installing a new kitchen, adding new rooms or building an extension, it’s important to remember that every lender is different and has different criteria on what they will and won't consider. So, if your existing lender has said no to your request, make an enquiry and speak to one of our advisors.
