remortgagin - what are the legal fees?

Spiritseeker

Hi all,

I am a first time remortgager - I bought my home 2 years ago and took out a fixed rate deal which ends at end of June. I would like to remortgage to an HSBC fees free tracker.

I am just wondering whether it's necessary to have a solicitor to facilitate the transfer of money from HSBC to my current lender? Or is it a straight transfer between banks? The HSBC product is fees free apart from any legal fees, so I am just wondering if there are any, and if so, what they are.

thanks in advance

Thrugelmir

Switching to another lender is in effect a new mortgage application, which will require the services of a solicitor. HSBC are very strict on their lending criteria so worth ringing them to see if meet them.

Staying with your existing lender is merely a change of product not a remortgage.

Spiritseeker

I see - I had naively thought that as I was not purchasing a new property, there were no checks to be done!

Are you able to advise what a reasonable price range is for a solicitor to act in a remortgage application with a new lender? And what would he actually need to do?

GMS

Get some quotes d from solicitors. Make sure they are all inclusive and not just legal fees i.e all searches, land reg fees etc.

Typically you would be looking at around £500.

Check with the lender as some offer free legals on remortgages.

Have you checked the market to see if HSBC is the best deal? Also see what your current lender has to offer and remember this would mean no legal fees so may be worth a few quid a month extra

Spiritseeker

Oh wow, all those searches need to be paid for again? I don't understand why that would be neccesary - is that to keep the lender happy that all is ok? Surely the searches done 2 years ago would satisfy that?

As this is the first time I am remortgaging, clearly there is a lot for me to learn, but I don't understand why I would need to pay for the same things I paid for 2 years ago to the existing lender's satisfaction. Is it not possible to provide that paperwork to HSBC?

GMS

The lender is securing their loan on your property so they need to be certain it is suitable security.

They need the solicitors to act on their behalf and all documentation needs to be relied upon by them.

Spiritseeker

Well thank you for the helpful responses. At least I will not be totally taken by surprise by an additional £500 cost that I had not been expecting

Edit: having re-read the thread, I wanted to respond to a couple of questions you had, GMS. You've been helpful so far, I wonder if you wouldn't mind offering an opinion on the product? I fit within the 60/40 LTV bracket (my mortgage is approx 50% of my property value). I am currently with RBS on a fixed 3.15% 2 yr deal due to end on the 30th June.
The product I am looking at is HSBC's tracker, 1.89% above B of E base rate, for the term of the mortgage. It is fees free - except for the legal fees. There are no exit fees and no overpayment fees. It seems like a fantastic deal and seemed even better as a 'free' product with the versatility to allow me to remortgage at any time if I felt a fixed might be better if rates start to sky rocket.

Obviously up till now I had not banked on any legal fees, naively thinking that they were not necessary as I am not purchasing a property, just remortgaging.

My current lender puts me onto their variable rate of 4% from July.

The HSBC tracker seems like a fantastic product, not just because of the rate and lack of application/valuation fees, but because I could switch whenever I wanted. Although at that time obviously there may be fees to pay for the next remortgage if that is what I were to do down the line.

Does my reasoning seem sound? Or am I missing other potentially unthought of charges?