When your existing fixed-rate or discount mortgage rate comes to an end you should review your options. This may be changing to a new deal with your existing lender or moving your existing mortgage to another lender to take advantage of a better deal. This is known as a remortgage.

We would always recommend that you take independent mortgage advice when reviewing your existing mortgage deal. The mortgage market is presently very competitive.

Doing nothing should not be an option. If you stay with your existing lender without taking out a new deal you will be moved on to their Standard Variable Rate (SVR). This could result in higher monthly mortgage repayments.

If you stay with your current provider and take out another deal with them, this is called a product transfer. It is worth remembering that despite what your existing lender tells you, this rate is unlikely to be the best deal for you. The chances are that your home will have increased in value, and you may be earning more money. All factors that will help you get a better deal elsewhere.

When recommending a remortgage our advisers will always take into account the costs, if any, of changing lenders.

Remortgaging affordability tests. What are they?

The Mortgage Market Review (MMR) which came into effect in 2014, introduced far stricter lender assessments to check whether you can afford the mortgage you are applying for. This also includes remortgaging.

The lender will look at your income and expenditure. Some lenders work on national or postcode averages, others will want more detailed personal figures. If you are looking to remortgage, it’s best to get your finances sorted out at least three to six months before. This gives you plenty of time to make changes to your cash flow which may help your application. The lender will also want proof of your identity and address details. This is usually a driving license or passport together with a recent utility bill showing your current address. Remember, mobile phone bills are not normally accepted. Credit reference agency checks will also be carried out.

Can everyone remortgage?

A change in your financial circumstances can also affect your chances of getting a competitive remortgage. This may be that you have gone from a two-income household to one or going from employed to self-employed.

If your home has increased in value from the last time you took a mortgage deal you may be able to get a better rate. If your loan to value (LTV) has got better you may be able to borrow at a more competitive rate. This may also allow you to release money from your property to complete home improvements such as an extension or a loft conversion.

What about Early Repayment Charges?

It is essential to check your mortgage documents for the Early Repayment Charge (ERC). Our mortgage advisers can help you with this. This will help you find out if it will cost you to move to another lender before your mortgage deal finishes. We normally recommend that you start looking six months before your existing deal finishes.

From a regulatory point of view, lenders must treat customers fairly. This means they will have to contact you at least a month before your deal matures, to let you know about any changes and options available.

The lowest rate does not always mean the best deal.

The best mortgage for you doesn’t necessarily come from the one with the lowest rate. You should always look at the total cost of the borrowing over the term of the deal.

You need to be aware of any other fees as part of the remortgage. Such as legal fees or survey fees.

Fees free deals offered by some lenders are attractive and popular. Unfortunately, the service offered by some of the legal firms they appoint can be poor. If you are looking to remortgage quickly and with less hassle, you may be better off taking the “cashback” option. This allows you to appoint your own local conveyancer or solicitor and use the “cashback” to cover their fees.

You can start your research by checking out the top remortgage deals on our website. The rates are updated daily.

It’s also important to be aware that some banks and building societies won’t lend less than £25,000. They will also want the mortgage repaid by a set age.

How Anstee & Co can help you with remortgaging.

We are a firm of independent mortgage advisers. This means that the advice we offer is unbiased. We look at all the financial solutions available to you from the “whole of market”. All our mortgage advisers are fully qualified with many years of experience. They work with our “mortgage support” team based in Kettering.

Meetings can be arranged at a time and location convenient to you. This may be a home visit, an early evening meeting or at a weekend. Why not arrange a meeting today to see if we help you save some money by remortgaging? Our Head Office is located at-

• Kettering, Northamptonshire

Our mortgage advisers live and make use of meeting rooms in-

• Bedford, Bedfordshire
• Market Harborough, Leicestershire
• Northampton, Towcester, Wellingborough and Thrapston in Northamptonshire.

We can also arrange a meeting online so there is no need to visit an office. The choice is yours.

If you have any thoughts or comments on this article, “Should you be remortgaging to a better deal?”, then we would love to hear your views.

Finally, the information contained in this article is for information purposes only and does not constitute financial advice. No action should be taken based on this information alone. Anstee & Co is authorised and regulated by the Financial Conduct Authority (FCA).

AS A MORTGAGE IS SECURED AGAINST YOUR HOME, IT COULD BE REPOSSESSED IF YOU DO NOT KEEP UP THE MORTGAGE REPAYMENTS.

Why is this happening?

Traditional interest-only mortgages were popular in the Nineties and 2000s. Interest was coved monthly and additional funds were paid into a separate repayment vehicle. This might have been an endowment policy. However, the mortgage lender rarely asked about the repayment vehicle and these were often cancelled when budgets became tight or the policy did not perform. It is thought that there are over 1.6 million people with an interest-only mortgage who do not have any way of repaying them.

What are the solutions to interest-only mortgages?

New, Financial Conduct Authority (FCA) rules have been introduced that allows banks to relax lending criteria for the older borrower. Previously the mortgage would have to be repaid by age 65 or 70. These new interest-only mortgages allow you to continue making interest payments indefinitely. The capital is only repaid when the property is sold or when the customer goes into care or passes away.

To qualify for these new types of mortgages you must be able to demonstrate that you can afford the interest repayments. This may be an issue if your retirement income will be low. However, other options such as equity release may be appropriate.

How much will these new interest-only mortgages cost?

The initial rate we are seeing range from 3.50 to 4.00 % depending on the size of mortgage or the term. Both fixed and variable rate terms are on offer. They also come with an arrangement fee varying between £500 to £1,000. We would expect that with more lenders coming into the market competition may help to see these terms improve.

How Anstee & Co can help you.

These mortgages are a really useful financial planning tool for financial advisers. To see if these products are suitable for you why not arrange an appointment to receive a personal illustration.

Anstee & Co are Independent Financial Advisers (IFA’s). This means that we offer unbiased advice. We will look at all the options available to you and we do not work from a limited panel of providers.

We have offices in-

• Kettering, Northamptonshire

• Stamford, Lincolnshire

• Birmingham, West Midlands

• London, Central London

Our expert advisers also make use of meeting rooms in Northampton, Bedford, Wellingborough, Warwick and Droitwich. Home visits can also be arranged. Why not contact us to arrange a free initial meeting.

As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.