Help with understand re-mortgaging

monkeyman2011

Hi,
I'm a newbie here, have been reading the forums for the last 6 months but decided to register today.

I would like some advise on re-mortgaging.

We are currently with Halifax. Our fixed rate ends in May, and drops down to the 4% variable rate. I don't know much about mortgages to be honest. What I want to know is am I able to switch to another lender, or do I have to stay with Halifax?

Our mortgage was originally 35 years as was the only way we could get on the ladder. We now have 33 years to go, and about £140,000 left to pay. We orignally had a £20,000 deposit. If I wish to switch to another bank/building society, do I have to get myself another deposit together? Or can I just re-mortgage for £140,000? If anyone is able to shed some light on the above that would be great! All very confusing if you ask me! Thanks in advanced!

GMS

You could look at what Halifax have to offer you for a new deal, and you are free to search elsewhere when your fixed rate is up.

Any equity you have in the property will be your deposit. Your remortgage will be based on the value of the property at present.

Speak to a Whole of Market mortgage broker to see what your options are as well as speaking to Halifax

monkeyman2011

Hi GMS, many thanks for the speedy reply. Thank makes things a bit clearer. I was wondering how I would get another deposit together if we were to move.

So the remortgage isn't based on what you have left to pay then, it's the value of the property?

Thanks
Dave

GMS

Figures will be based against the value of the property. Obviously if you remortgage you will need to clear the existing mortgage first.

If you owe 140k you would need to repay this but you may be able to borrow more if you wished.

You would be looking for 20% plus of equity to access the better rates.

Good Luck with the search

blueberrypie

monkeyman2011 wrote: »

So the remortgage isn't based on what you have left to pay then, it's the value of the property?

The mortgage is based on how much you are borrowing, and how much the property is worth. How much you can borrow is largely determined by your income.

You need to think about it from the lender's point of view rather than your own - this will make it clearer.