What is the difference between remortgaging, refinance?

alien123

I have not purchase a single flat or house yet so I probably will be a first time buyer if I have enough cash for deposit.

When I come across on researching mortgages, few of the terms come up and I have been searching the real meaning of remortgaging and refinance but I still cannot separate them from one another.

Can you guys direct me to a very easy understandable site? Because it seems the only difference between them is refinance can get more money apprently but not sure I got the right meaning...

Can you guys help me with the terms and let me know the advantages and disadvantages plz

Thanks in advance

_Andy_

I'm lost - you're a first time buyer so why are you looking at remortgages?

alien123

I am a first time buyer but when i browse through deals and found terms such as remortgaging and refinancing which i do not understand. Therefore, i wana clear up the theory for the future reference. thanks

_Andy_

A remortgage would be where you already have a mortgage on a home and wish to change lenders.
This isn't applicable to you as you are a first time buyer.

Ian_W

alien123 wrote: »

I am a first time buyer but when i browse through deals and found terms such as remortgaging and refinancing which i do not understand. Therefore, i wana clear up the theory for the future reference. thanks

Remortgaging refers to someone who already has a mortgaged property changing the lender or the amount borrowed. Why would they do that? Well they may be at the end of a fixed or tracker rate deal and want a better rate that's on offer with another lender. Or if the value if the property compared to the outstanding mortgage allows it they may want to borrow more to extend the property or buy a flash new motor! If that's done with the existing lender it's usually called a "further advance" but if they change lender then it's a remortgage.

AFAIK "refinance" is a term used by the Yanks in terms of home loans though it's used to describe those with business loans finding a new lender in the UK.

alien123

Thank you guys with the answers. Although still not fully understood but appreciated with the response and help.