Confused about remortgaging

Moonchic82

Hi, my current deal with RBS (Base + 0.24%)comes to an end on 30th November, when I move to SVR at 4% currently. This is the first time I've had to remortgage.

They've sent me a letter to say to call them to discuss new deals which I will do, but would like some info first. They say if I'm keeping the same mortgage amount, which I will be, that there are no forms to fill in and no valuation or legal fees to pay. How then do they determine the current value of my house, or is this not an issue? I have looked online at their deals for existing customers and the rates are split dependent on minimum deposit %. What is this % based on? Will it be what I originally took out mortgage for or outstanding balance against current house value?

Thanks

Bufger

its usually on the equity in the house, they can count that as a deposit towards the next one to calculate the rate (ie what ltv you have after the equity has been taken into consideration).

By the way you got the best rate at the best time with your last mortgage. I hope you overpaid massively???!

Doglover

do you know if they do a new credit check etc if you're looking to borrow less than your current mortgage but remaining at the same property? I have some savings ready to clear a bit off my mortgage and wondered the best way of doing it. I'm allowed to pay 10% per year and didn't know if it'd be better to pay off some of it this year and then pay off another chunk in the new year in readiness of my remortgage which is June 2010. If I leave it until next year I will not be able to pay off enough within the 10% allowance. I don't know if it's possible to keep the savings until I drop onto the SVR in June 2010 and pay off the chunk I want to pay and then look at the re-mortgage deals. Thanks

dimbo61

Hi Doglover,
If you have some spare cash sitting in a savings account earning you less interest after TAX than you are paying on your mortgage then pay off 10% TODAY.
Check with your lender first and see if they work on calander years!
Pay another 10% ( or whatever you can afford) next year.
If you change lenders in June 2010 they will do a new credit check on you before giving you a new mortgage no matter what the size.
You can keep your savings until June 2010 when your deal ends and then simply pay a lump sum off the mortgage.
Check what your current lender can offer you and GOOD LUCK

Doglover

I'm pretty sure that its 10% per calendar year. I was wondering whether my current lender would do a credit check if I were looking to change to a new fixed rate when mine expires next June but for a lower figure. I know they don't if I borrow the same amount. I've had a couple of late payments in the last 6 months so I am hoping to avoid a credit check. I am happy to swap onto a deal with my current lender when this mortgage finishes but I've got (nearly) enough to bring my current 85% LTV down to 75% LTV (but will have enough by next Feb) and wondered when would be the best time and how would be the best way of paying some off the current mortgage amount but be able to continue with my current lender but for them not to credit check whilst being able to be offered their new 75% LTV deals next June.

Sorry to ramble.

dimbo61

Read the paperwork that came with your mortgage offer and see what your mortgage revertys to after June 2010!
You still have a mortgage with the same lender and you may go onto the lenders SVR or some type of tracker ( I DO!)
The less you owe and more equity you have in the property the happier the lender and the better deals they can offer you.
They cant say right your mortgage deal is UP give us our money back as long as you keep paying the mortgage payment each month.

Doglover

The SVR is 2% above base rate. So, if i'm on the SVR for 6 months or even a year will my current lender still offer me a new deal with them without credit checking me? Whilst on the SVR I beleive that I can make as many over payments as I like penalty free. Will the lender revise their mortgage offer to me after i've paid some off the mortgage whilst on the SVR? I am hoping to knock the LTV down to be eligible for their lower LTV products. Will their offers be based on the amount I owe compared to what they deem the value to be at the time of making the offer? Will they credit check me if i've been on the SVR for say 6 months but during that time I've reduced the LTV?

sorry for another barrage of questions!

dimbo61

So your mortgage would drop to 2.5% at todays BOE base rate!
What it might be in june 2010 is anyone guess but you will go onto the SVR no matter what your credit score or how much you owe!
If you overpay you will owe less and have a better LTV so might be able to get a better deal then.
You can only ring them up and ask about the credit score thing ( dont give your name just asking for information)
" Do you do a credit check on existing customers changing deals if borrowing the same amount or Less "

Doglover

Great, thanks for the advice and i'm sorry I have so many questions!

So, to be clear, I think i'm right in that I should pay as much as I can this year onto the mortgage (subject to the max 10% so that it is penalty free) and then the balance of my savings in the new year and then hang around on the svr until it seems sensible to re-fix. Double check with my current lender about whether they will credit search after being on the svr and then over pay as much as poss to keep the ltv down in order to get the best mortgage with my current lender?

My current LTV is 85% but I should be able to get that down to 75% by the time my current fixed deal expires so hopegfull my current lender will offer me a relatively decent fix next June. This is of course based on the current valuations and I guess that may be reduced by the lender if prices start to drop again.

Does anyone know how regularly the mortgage lenders review their valuations? Do you know what guides them?

Thanks