Remortgage advice

lisael76

Hi there, hope one of you can advise on this one.

Iv just taken out an interest only mortgage through a broker and dont know much about the remortgage process as I'll be looking to do this after 2 yr fixed rate ends in 2009.

When you remortgage, what amount of the mortgage is transferred to the new mortgage/lender at the remortgage stage?

On my keyfacts illustration, it tells you the amount that I would pay back over the whole of the term (30 yrs) and this being 235,000 including all the interest.

Is this the amount that gets remortgaged or is it the actual amount you borrowed initially minus what you have paid off

Sorry to sound thick, but not got a clue.

Be grateful of any advice

Thanks

herbiesjp

lisael76 wrote:

Is this the amount that gets remortgaged or is it the actual amount you borrowed initially minus what you have paid off

Thanks

It is the later of the two

You re-mortgage for teh balance of your current mortgage.

So if you start with £100k and after 2 years have paid back £2k, you will then re-mortgage for £98k.

HTH

lisael76

Thanks, I was a little worried on reading the keyfacts, then I thought, how on earth would a new lender grant me a mortgage for £200,000 plus

trippy

Although in your case, as it's an interest only mortgage, the balance will be the same after two years as you won't have paid anything off.

lisael76

Thans for reply

Yes I wondered about that, being interest only but I suppose as Im currently renting anyway, it wont make a great deal of difference, the only benefits im thinking of is that it'll get me on the propery ladder.

Its also a right to buy off council and I have to wait 5 yrs before I can sell my property to avoid paying back the council a % of the discount they gave me, and also have borrowed extra cash to pay off my mountain of debts and do my place up, also by paying my debts off now, when the 6yrs have passed for my defaults to drop off, it means my daughter shouldnt have any probs obtaining credit when shes 18 because of my debts.