Mortgage Switching help please?

ampan_2

Hello - I bought a home six years ago with a deposit of £50,000. It's current value is approximately £140,000.
My mortgage is with Halifax and has been since the beginning. I am currently paying £230 interest out of my £500 monthly re-payment. I feel like I might be able to get a better deal elsewhere, but have absolutely no clue about whether this is a good idea, where do I look to changing my mortgage? Is this called re-mortgaging? Does the amount I've already paid off count as deposit? I'm very confused.
I'm sure I sound foolish - but any help would be very much appreciated.

Thank you.

Yorkie1

First you need to check what your interest rate is with Halifax. I assume you're out of any fixed term and so you're probably on a variable interest rate?

You need to know how much you still owe on the mortgage - Halifax will be able to tell you, but for a rough estimate look at your most recent mortgage statement.

And the final preliminary checks relate to your credit position; is there anything in your 3 credit reports which might make a lender not want to lend to you? CCJs? Use of overdraft? Late or missed payments? etc

Assuming no difficulties there, your options are either to stay with Halifax (this is called a product retention, and you won't be rechecked for credit if you're not borrowing any more) or to move to a different lender (this is called a re-mortgage).

Work out how much your current mortgage is as a % of the house value and this gives you the Loan to Value (LTV) sum. So if the house is worth £140K and you've got £80K outstanding, your LTV is 57% - just under 60%. Mortgages come in different tiers or bands, depending on your LTV.

Decide what sort of product you want e.g. fixed, tracker, and for how long e.g. 2 / 3 / 5 years.

Then look on the Halifax website to see what products they have for existing customers, and have a browse on other sites to see what remortgage products they have. A broker can do this for you if you choose. Then compare interest rates, product fees etc to see how they stack up.

If you remortgage to another lender don't forget you'll have an exit fee from your present mortgage, plus survey and legal fees to add in (unless they are free).