The key stages below
outline the processes involved in re-mortgaging a property.
1.
Ascertain the loan amount you require
· If you are looking to swap your mortgage to
another provider to save money by getting a lower rate then you will need to
find out from your current lender how much is outstanding. It is also a good
idea to confirm that you will not be expected to pay an Early Redemption Charge
or ‘ERC’. If you are still paying the introductory rate with your current
lender then it is likely that an ERC will be payable. Think carefully before
paying this fee just to move the mortgage to another provider, this may reduce
your monthly payments but the increase in the loan amount may cost you more in
the long run.
2.
Think carefully before increasing your loan
amount to pay off other credit
· Take time to consider
the effect of adding any current credit you have to your mortgage. In some circumstances, it is beneficial to repay current
credit by increasing your mortgage loan. Your mortgage adviser will be able to
help you decide whether it is a good idea to raise money by increasing your
mortgage to repay current debts.
3.
Make a Note of Your Personal Details
· When you have found a mortgage adviser that you
would like to help you find the best product to suit your requirements, the
first thing they will need to do is collect information about your personal
circumstances. It will speed this process up if you have information to hand
regarding all applicants’ address history, income details, a breakdown of your
current monthly outgoings and details relating to any existing credit you may
have. It is important that you are as open and accurate as possible with all
information you give to your adviser. This process is referred to as the ‘Fact
Finding’ process and can be done over the phone, at a face to face meeting
somewhere convenient to you, or even online depending on the company you choose
to handle your enquiry.
4.
Inform your Adviser of Your Requirements and
agree on a mortgage lender and product
· Tell your adviser about any preferences you have
in regards to your new mortgage. I.e. if you want to be able to make
overpayments or take payment holidays, or if you want to fix your rate for a
certain amount of time. Let your adviser know of any properties you have
already looked at or if you have got a purchase price in mind.
5.
Submission of Application to Lender
· Once you have agreed a purchase price and
mortgage product, and you have provided all the necessary documents such as
identification and proof of address, your adviser will submit an application to
the Lender on your behalf.
6.
Choose a Solicitor
· As with purchasing a new property, a re-mortgage
will require you to appoint a solicitor to act for you and the lender. If you
don’t already have a solicitor, we can introduce you to one. Many lenders will offer to pay for your conveyancing
as an incentive for choosing them
7.
Valuation, Confirmation of Details Provided
· Once the Lender receives your application, they
will carry out various checks and almost certainly carry out a Valuation Report
on the property to be mortgaged. Although you will receive a copy of this
Valuation Report, it is mainly for the Lender’s benefit. You may be required to
pay for this report upfront but more and more lenders are now offering a free
valuation as an incentive for choosing their products.
8.
Mortgage Offer
· Once the Lender has carried out all necessary
checks and has fully approved your application, they will issue a formal
‘Mortgage Offer’. Once you have accepted this offer, both you and the Lender
will be legally bound by its terms. It is likely that there will be set
conditions that you must satisfy before the Lender will release the mortgage
funds to your Solicitor for completion. An example of a condition would be that
you must always have a valid Buildings Insurance Policy with a sufficient sum assured.
9.
Conveyancing and Completion
· Once the lender has issued the Mortgage Offer, a
copy will be sent to you, your mortgage adviser and your solicitor. Your
solicitor will follow the instructions in this offer and set a completion date.
This process will usually take around 1 week depending on the lender and
conveyancing firm. Once the file is ready for completion and the new lender has
released funds to your solicitor, they will settle your current mortgage and
any extra funds being raised will be sent back to yourselves.
Contact Mortgage Advice Services - The Mortgage Specialists on 01332 257 087 to speak to a professional mortgage advisor todayLabels: the re-mortgage process