When to remortgage

Jorayner

We have a fix rate mortgage ending on 31st August, when we would normally remortgage.

My husband has been offered a very generous voluntary redundacy package that he is considering taking in the next month, although he will have to work notice.

I feel maybe we should set the wheels in motion to remortagage now , before he makes the decsion as we will not be able to borrow the amount we need if he is not working.

He may be lucky and find another job quite quickly, but then we won't have the stability of employers that the mortgage companies like. He has been with his existing employer for 16 years.

Is it too early to start trying to remortgage ? We face big penalties if we complete before 31 August.

Really don't want to get stuck on SVR.

What do you all think? All advice gratefully received

humfer

You probably have time to wait and see. If your current mortgage ends in August, and as your simply remortgaging which takes out a load of the work mortgage companies have to do (compared to new houses, etc.) it would probably only take around 3 to 4 weeks to agree a new remortgage anyway. At least this way your likely to know more about your circumstances and will not be left with a product you no longer want or need. Especially so as with most new mortgage products you will need to pay an application or administration fee upfront regardless of whether you eventually take the mortgage out or not

AndrewSmith

If your rate finishes at the end of August I would suggest you start looking round anytime now really.

Bearing in mind that even though you may only be re-mortgaging, if you switch lenders there is still the legal conveyancing process to go through which can, in some cases, take up to 6 weeks.

Rather have options available to you now (considering also that fixed rates are creeping up) than leaving it and having to pay standard variable rate because you are waiting for a solicitor to finish their work.

Andy

martin1018

Hi Jorayner,

I remortgaged at the end of March this year and started looking in November last year, at which point I sourced a replacement product which suited my needs exactly. I did all the paperwork and planned for it to start the day after my old one expired, that way all the paperwork was done and dusted and all I had to do was wait the 5-6 months before it became live.

Consequently I'm sure that you could do similar, with all the paperwork being based on your current circumstances.

It was almost easier than falling off a log. You have the advantage that rates shouldn't make any drastic moves between now and when you would want to do the swap, a potential problem with the time scales I used.

Best wishes, hope it all goes well.

Martin.

Jorayner

Thanks - i am keen to get it sorted as I really really don't want to pay SVR even for a day!

Must get going on it now.

MortgageMamma

Hi There

When is your husband likely to be made redundant? If he is not redundant nor serving notice of redundancy at application or completion you should be fine, otherwise beware, the lender may actually request references from your partners employer. If you want to play it this way I would act sooner rather than later, especially, as Andy says, fixed rates are creeping up (assuming you want a fixed rate). Also, did you know you can specifiy your own completion date? i.e. tell your lender/solicitor not to complete before 31.08.06?

Can I ask what your property value is, the amount you want to borrow and your joint earned income is?

AndrewSmith

Jorayner wrote:

Thanks - i am keen to get it sorted as I really really don't want to pay SVR even for a day!

Must get going on it now.

Very wise. As I said earlier the comaprable swap rates are on the increase, with numerous notifications being received daily by brokers such as myself of lenders withdrawing current rates and replacing them with higher ones.

Have it ready to simply drop in place seamlessly at the end of your existing deal.

First port of call would be to ask your existing lender what retention deals they have. Always worth a punt . You may find that although your existing lender may have a new rate that doesn't seem as competetive as some others, after taking into account the intrinsic costs of actually switching lenders (legal fees, arrangement fees, deed release fees, valuation fees) you may actually be better off than moving to a new lender. Also the transition would be seamless.

Don't get too bogged down on the 'cheapest interest rate', you need to look at the package as a whole to determine the 'true' cost.

Andy

regularsaver1

I'd agree with above - to stay with same lender you would not have to prove income ect