New to re-mortgaging

Wootball

Hi there - I'm completely new to the idea of re-mortgaging. In 2009 myself and my wife took out a mortgage on our home. Of course, being first time buyers and with only a 10% deposit, our interest (and therefore repayments) are quite high. It was on an initial 5-year fixed rate, with Santander. This being the case, we still have 14 months left of our fixed-rate period.

Don't get me wrong, we can afford the repayments. It's in no way a 'oh my god we cant play anymore' plea. However, we have a baby on the way in September and, if possible, we would like to reduce our monthly repayments as much as possible. Additionally, we have £3000 on a credit card (again, repayments are not an issue) which ideally we would like to add on to the mortgage so that we can reduce our monthly repayment even further.

Where do I start with this? What's the process of re-mortgaging, and how easy/complicated is it to do?

Dave_the_Ginger_Cat

Can you share some figures?

What rate are you on today? What are the early repayment charges, what is your loan amount, and how much roughly is your house worth?

Thanks

kingstreet

With a 90% mortgage four years ago, you may not have the equity to remortgage just to refinance the mortgage, never mind borrow more for debt consolidation.

Suggest you spend some time establishing the value of the property now and how much you would have to repay your existing lender, inclusive of early repayment penalty and discharge fees.

Ximian

There is a free re-mortgage guide with useful information available from MSE: http://www.moneysavingexpert.com/mortgages/remortgage-guide

My mortgage is also with Santander and I can overpay a maximum of 10% per annum, your mortgage might be the same. By overpaying the mortgage capital on a monthly basis or even a lump sum you can bring down the monthly repayments. If you fixed your mortgage in 2009 I would imagine that the rate is higher than what is available now, it depends on how much is still outstanding on your current mortgage and how much you would have to pay to ditch the mortgage to change to a cheaper mortgage.

If you are shopping around for a new mortgage, the following calculator is quite handy for checking the true cost of the mortgage: http://www.thisismoney.co.uk/money/mortgageshome/article-1633400/Mortgage-calculator-True-cost-calculator--fees-charges-rates.html
Some mortgage rates tempt you with the low rate but have a high arrangement fee and when you factor this in it might even work out more expensive than a mortgage with a higher rate.

Re-mortgaging itself is relatively easy, especially if you stay with the same mortgage provider. When I re-mortgaged a few years ago to switch providers I called London and Country and they were very helpful finding a mortgage that suited my needs.

Wootball

Dave_the_Ginger_Cat wrote: »

Can you share some figures?

What rate are you on today? What are the early repayment charges, what is your loan amount, and how much roughly is your house worth?

Thanks

Our mortgage was on a £130,000 property with a 10% deposit, so £117,000. I'm not 100% sure what we currently owe so I'll need to contact Santander to get hold of that. Our rate is 6.69% which is the cause of the high monthly repayment and the one aspect I'd like to bring down. The house has had some work done which should hopefully increase the value, but I wouldn't like to guess and so I'd say it's still worth the £130,000.

I believe an early repayment with 1 year remaining of a fixed rate is 3% with Santander.

amnblog

Your early redemption penalty with Santander would make remortgaging elsewhere almost certainly too expensive to be of benefit.

Speak to a mortgage broker to be sure in your own circumstances.