Remortgaging FAQs

4th September 2019


What is remortgaging?

Remortgaging is the process of switching your existing mortgage product to a new mortgage product, either with your existing lender or a new lender.


What happens when my fixed rate mortgage deal comes to an end?

If you’re currently on a fixed rate mortgage, it means for a period of time (typically between 2-5 years) the interest you pay and the monthly repayment will be fixed. Once your fixed mortgage deal comes to an end, you will be placed onto the ‘Standard Variable Rate’ (SVR). Each lender sets their own SVR and it tends not to be as competitive as fixed rate mortgages. You can find out more about SVR here.


I was permanent when I took out my mortgage but now I am contracting. Will I be accepted for a remortgage as a Contractor?

As a Contractor, you will still be able to get a mortgage however, your existing lender might not be able to understand your income now you’re contracting. It’s important to speak to a specialist Contractor mortgage adviser who works with the whole of market and will find a lender that can understand your income and make sure you’re getting the best mortgage product available.


How much could I save by remortgaging?

The average SVR is 4.9% as of January 2019. While the average 2 year fixed rate is 2.52%. To example what that means: If you have a mortgage of £100,000 with 25 years left on the term and are on the SVR your monthly repayment will be around £579. However, if you remortgage onto another 2 year fixed rate your monthly repayment will be around £450. This is a saving of £129 a month or a saving of £3,096 over the duration of the 2 year fixed rate period.


What documents do I need to remortgage?

If you’re switching to a new lender, the documents you need to provide will be similar to when you applied for the first mortgage. This will include details of your current and previous contract (if applicable), 3 months bank statements and, if you have less than 3 months remaining on your contract, they will require a contract extension.


Are there any charges for remortgaging?

There are some fees to be aware of when remortgaging, for example some lenders have upfront product fees ranging from £500-£1,000. If you’re not sure whether you’d want to pay a product fee, a Contractor mortgage specialist can help you look through the options.


Can I borrow more by remortgaging?

A great benefit of remortgaging is that it gives you an opportunity to borrow more money. This can be used to make home improvements such as building an extension or refurbishing the kitchen or bathroom. Make sure you speak to an expert Contractor mortgage adviser to help assess how much you can borrow based on your day rate.


Where can I find the best rate?

This is where we can help. Scouring the market for the best mortgage product can be a long and difficult process and, unless you have the right expertise, you may not end up with the best deal for you. Our specialist Contractor mortgage advisers do all the leg work, working with Contractor friendly lenders, so you don’t have to. Get in touch today and see how much you could save on your remortgage.


All content is accurate at the time of publication

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