Re-Mortgage

Remortgaging can be an ideal way to get money out of your property without having to sell up or take any other drastic measures; it is simply using the property as equity. If there are complications, it may take a while to sort out a new deal. Lots of people who have remortgages in the last year have had it all sorted in the space of a week, and some within a number of days. Your adviser should give you give you some idea of the time scale that would be involved.

Some mortgage lenders have scrapped redemption penalties but many still apply them to curtain deals. A redemption penalty may be charged if you pay off or switch mortgages within a set time period. Before you remortgage, check whether or not redemption charges apply to your current mortgage deal, and if so, how much they will cost – some redemption charges can run to thousands of pounds. Also, check whether the new deal will carry redemption penalties.

You can remortgage as many times as you like and as often as you like. But bear in mind that you might be liable to pay redemption penalties if you are currently on a capped, fixed or discount rate mortgage. And you may have to pay arrangement and legal fees. But you should look at your mortgage every year and see whether remortgaging could save you money.

Remortgaging is viewed by some as an easy way to get hold of a decent amount of money, but it carries its dangers too, which you should consider before you go through with it. This is particularly true if you are using it to consolidate all of your other debts by remortgaging for more than the remainder of your last mortgage.