You can look into a remortgage at any point by contacting your current mortgage company and/or a qualified mortgage adviser.
Whether you can remortgage or not will be based on your current mortgage, your finances, and what you are looking for when you remortgage.
It can be tricky to understand what you can and can’t do when it comes to borrowing money, and you may be feeling nervous if you have debt or a poor credit history.
You’ll be happy to know that you can get a remortgage in most circumstances where you have a regular income and can afford the repayments, but it’s important to take interest in the interest -- as this is the amount you get charged for borrowing along with any fees.
Your current mortgage provider can give you the facts, but only a qualified adviser can legally give you advice on your remortgage. Why? It’s fairer.
An adviser doesn’t point you to one option but matches your finances and what you need to the most suitable lenders, so you can choose which remortgage and company are best for you.
It’s essential to know the facts when it comes to money, especially your remortgage, as there are costs and different types of remortgage to consider.
Understanding them fully will help you to budget each month and understand what your choices mean over time.
Yes, you might still be able to remortgage if you have bad credit.
Like any service, each lender specialises in remortgages for different reasons, including those that accept minor credit hiccups.
Unfortunately, bad credit, despite why it happened, is seen as your ability to repay anything you borrow, which limits the companies that will lend you money.
Bad credit can impact your chances of getting a remortgage or will mean you will have to pay more to borrow money as you’re seen as being at a higher risk of not paying.
You still have a few options, though, as there are different levels of ‘bad credit’. For instance, if you missed one payment or have one county court judgement that was some time ago, you may still be able to remortgage.
You can also start to rebuild your credit score by making sure you don’t miss any monthly payments moving forwards, even on your phone or credit card by setting up direct debit payments. That way, a minimum or agreed payment is taken every month automatically.
It’s important to obtain advice if you’re applying for a remortgage with a bad credit score.
Declined applications for a remortgage are sometimes recorded, so it’s best to only apply where you have a chance of a ‘yes’ or wait and build your credit score before applying. A mortgage adviser will have experience of what level of bad credit might be acceptable.
Yes, you might be able to remortgage with credit card debt. Your credit card balance will, however, be taken into account when you apply for your remortgage.
When you apply for a remortgage, the company lending you the money will take into consideration any debt you have and total affordability, which will include your monthly credit card payments and time to clear the balance.
Having a credit card can actually increase your chances of obtaining your remortgage. Why? Because it can demonstrate your ability to manage your finances and keep up with your monthly repayments.
Yes, you might be able to remortgage to pay off debt; when you do this, it’s called consolidating debt, which is to put everything you own into one monthly payment.
Remortgage companies often provide extra funding or a further advance of cash to existing customers for a house extension or replace a kitchen, so it’s not unusual for people to consolidate debt at the same time.
‘Should you remortgage to pay off debt?’ is the best question to ask, though.
At first, consolidating debt can seem a very sensible idea.
However, it’s best to discuss the total cost of a remortgage with an adviser. You might find out that it’s better to take out a secured loan over a shorter period of time and pay the debt off quicker, as a mortgage is often over a long period, which will add to the total cost of borrowing.
You might also find that borrowing money to consolidate debt is only available to you if you have already paid some of your mortgage off, which is your loan to value (LTV).
Yes, you might be able to remortgage and extend the term.
A lot of people remortgage their home for this reason as it can reduce monthly payments.
When you look at extending the term of a remortgage, you need to consider how much extra money it will cost you to borrow the money (interest over time), though. Extending the term during a remortgage is often capped at your predicted retirement age.
You could also consider extending the term with a remortgage and combining it with overpayments each month. Each remortgage will have rules that detail how much you can repay each month, which is usually 10%.
By overpaying each month, you’ll have the flexibility to pay your mortgage off early and reduce the term, while also only being committed to a smaller monthly payment.
Yes, you might be able to remortgage early. You can also remortgage before the end of your fixed term mortgage or rate ends.
Unfortunately, there will most likely be a cost, though. Almost every mortgage has a charge for exiting the mortgage early, which are called early repayment charges (ERCs). The charges usually go down by 1% every year, but this can vary.
So you’ll need to weigh up the benefits of remortgaging against any cost to exit your current mortgage. If you need to remortgage to move house, renovate, or repair, you might feel that the cost is acceptable, but if you can wait, you might save money.