There are many reasons you might consider remortgaging your home or buy-to-let property. You may want to free up equity for an extension, settle unsecured debts, or secure a better mortgage interest rate.
Homeowners approaching the end of their fixed-rate period will receive a letter from their solicitor. This letter will state the interest rate they’ll be moving onto and their new monthly payment.
Typically, this new rate is higher than what they paid during the fixed period. Remortgaging can help them move to a more favourable rate, either due to lower-priced products being available, a decreased loan-to-value ratio, or both.
So, how does the remortgaging process work and how long does it take? The good news is that it’s quicker than the original purchase of the property since the main objective is to satisfy the new lender’s requirements.
Remortgaging can take a couple of weeks after receiving your mortgage offer. Here’s a basic outline of the five-step process:
- Speak with Your Broker
Start with a conversation with your mortgage broker. They can advise on the most suitable mortgage product, what your payments are likely to be, and the next steps in the process.
- Find a Solicitor (if required), ID and Title Checks
Next, you’ll need to find a solicitor to handle the necessary conveyancing for your remortgage. Some lenders have their own panel of solicitors, and your broker can recommend one if needed.
The solicitor will conduct ID checks and review the title deed to confirm you are the legal owner and identify any charges or restrictions.
For leasehold properties, the solicitor will review the lease covenants to determine who needs to be notified about the changes. They will also ensure the title complies with the Council for Mortgage Lenders handbook.
- Mortgage Offer and Request Current Mortgage Statement
If there’s an existing charge, the solicitor will request a mortgage statement from the current lender to discharge the balance upon completion.
If you’re releasing funds from the property, this statement will also confirm the balance to be paid to you on completion.
- Completion
Just before completion, your solicitor will conduct a bankruptcy search. Once satisfied, they will set a completion date and request funds from the new lender.
When the mortgage advance is received, the solicitor will redeem your existing mortgage, settle their invoice and any disbursements, and repay the remaining balance (if any) to you.
- Update Land Registry Post Completion
After completion, your solicitor will update the details with the Land Registry.
This process can take up to six months for freehold properties or longer for leasehold properties. Once updated, your remortgage is complete!
If you have any questions about purchasing a property or remortgaging, feel free to call us at 01322 553282 or contact us online. We’re happy to help!