Very rarely do you take out a mortgage and stick with the same one for the whole term i.e. 30 years, until it is paid off and you’re mortgage-free (oh, the dream!).
Each household is different and there are various reasons why you might look to remortgage. Perhaps you want to borrow more money or maybe you’ve seen a better rate that you’d like to switch to.
Here are some other reasons why you might want to remortgage your home.
Current fixed deal is up for renewal
If you took out a fixed rate mortgage where you pay the same amount every month and the interest rate remains the same, once the initial term has ended (it would have been 2,3,5 years), you’ll fall onto a standard variable rate (SVR) where you could end up paying a higher interest rate than you were previously. This is usually the time when you might look to remortgage in order to switch to a better mortgage deal.
You want to move from interest-only to repayment
Perhaps you’re on an interest only mortgage and you want to move to a repayment mortgage. Generally speaking, your lender should be able to change this for you without the need to remortgage but if they can’t offer you the deal you want, then you might consider a full remortgage.
Want to be on a better rate?
You might want to move to a mortgage that has a better interest rate but sometimes the lender requires you to pay an early repayment charge before you can switch. It’s important to weigh up the price of the early repayment charge (sometimes referred to as exit fee or admin fee) against the costs you’ll be saving with the lower interest rate.
