Remortgage
A remortgage (also known as refinancing) is the process of paying off one mortgage with the proceeds from a new mortgage using the same property as security. Often the purpose of switching is to secure a more favorable interest rate from a different lender.
The process of remortgaging does not usually involve moving home or taking out a second mortgage on the property; it is in effect the transfer of a mortgage from one lender to another.
Typical reasons for remortgaging tend to be to reduce the size of repayments, to pay off a mortgage earlier, to raise capital, or to consolidate other debts.
Remortgaging needn't only occur when your mortgage term comes to an end. Some people take out a new mortgage simply to save money on their monthly repayments. For example, you may take out a fixed rate mortgage only for interest rates to plummet, leaving you stranded on a higher rate. Remortgaging to a more competitive rate in these circumstances may make financial sense. Bear in mind that remortgaging is not a cost-free process though. Your current mortgage may carry penalties or charges if you try to leave it early, plus there will probably be costs associated with the new deal, so factor all of this into your decision.
What is our role in this process
When you have received your mortgage offer you should return any documents that the lender sends you to sign to the lender immediately. At this stage, we would normally receive the paperwork from the lender. We shall then do the following-:
1. Check the terms and conditions of the mortgage offer to ascertain whether there are any special requirements that need to be complied with. For example, the lender may require certain work to be done to the property before the money can be released.
2. Check your title deeds to make sure they are in order and to enable us to assure your new lender that all the details of the property on the mortgage instructions are correct.
3. Conduct a local search of your property if your new lender requires it. The cost of this search varies from local authority to another.
5. Prepare your mortgage deed and any associated documents that your lender requires you to sign and we arrange for your signature to these.
6. Conduct a Bankruptcy Search for each borrower. This is to satisfy the Lender that you are not bankrupt. A Land Charges Search will also be carried out to ensure that no adverse entries have been made against the property.
7. Ask you what date you would like to complete your re-mortgage and then obtain a redemption figure from your present lender. The redemption figure is the amount that is required to pay your existing mortgage off. We must also redeem any other lending secured on your property.
8. Complete a Certificate on Title and also to request your mortgage advance in sufficient time for completion. You must ensure that your lender or financial adviser has put any new insurance policy "on risk".
9. Register your new mortgage at the Land Registry and finally return your deeds to your new lender after the registration is complete.
