First Time Remortage Advice

weebluebird

Hi. My current two year mortgage deal with Halifax ends in August 2016. I got a first time buyer mortgage with 5% deposit however i have been overpaying monthly (no charge for under 10% overpayment) to bring my LTV to under 90%.

My questions, if anyone could shed any light on them, are:

- How far in advance should i be looking at new deals? I plan to probably get a broker to help with this. I have looked up on comparison sites and it looks like i could save £100+ moving from Halifax after the two years.
- Is it better to overpay monthly or in one chunk before i plan to remortgage?
- What are the solicitor fees like for a remortgage? Are they the same as when you first buy a house?
- Can i get an independent valuation done on my house before searching new deals? Or is it better just to wait?
- Is there anything else i need to take into consideration?

Any advice would be hugely appreciated.:)

kingstreet

Three months earlier.

A decent broker will review your Halifax Product Transfer options at the time, as well as remortgage deals.

Whatever suits you best.

Many remortgage products offer free valuation, free legals and a product transfer would also be fee-free.

Wait until you speak to your broker. He will get the automated valuation from Halifax and discuss it with you.

Nope.

nirajn123

Hi Kingstreet, I have asked similar question but no replies yet but these are quite useful, so I'll ask a follow-up question here -

1. I am in the 3 month period approaching deal end - and Halifax is offering a deal at 1.86% (60%LTV), do you mean that my broker can get a better follow-on deal with the same lender?
2. If I were to switch, would the new lender do the complete checks again? Nothing has changed but I am a IT contractor and found (at an expense!) that limited lenders on the market offer mortgages so I want to avoid going down that route unless it is going to be guaranteed (but the broker)

weebluebird

Thanks Kingstreet. Very helpful.

kingstreet

nirajn123 wrote: »

Hi Kingstreet, I have asked similar question but no replies yet but these are quite useful, so I'll ask a follow-up question here -

1. I am in the 3 month period approaching deal end - and Halifax is offering a deal at 1.86% (60%LTV), do you mean that my broker can get a better follow-on deal with the same lender?
2. If I were to switch, would the new lender do the complete checks again? Nothing has changed but I am a IT contractor and found (at an expense!) that limited lenders on the market offer mortgages so I want to avoid going down that route unless it is going to be guaranteed (but the broker)

No idea, don't have time to look.

If you remortgage to a new lender, the status and affordability checks will be done, yes. If you expect your daily rate to be used again you'll have the same lender options. If your accounts or SA302s are strong enough, you'll have more lenders.

FreddieFrugal

weebluebird wrote: »

- Is it better to overpay monthly or in one chunk before i plan to remortgage?

better depends on circumstances (you can stop a monthly overpayment anytime if you hit hard times, trickier if you've already made a big overpayment.

If you have savings accounts that are at a higher interest rate than your mortgage. Then you may well find that the best option financially is to save up your overpayment and then pay it all once fix ends and there's no early repayment charges.

If not, then you're best overpaying by as much as you can (within your allowance 10%) as soon as you can. Remember when you remortgage, you may find your overpayment allowance reducing, if it's 10% of the new opening mortgage balance rather than the original figure.

One payment of £1500 will save you more in interest than three payments of £500 spread over three months.

I'm currently 1 1/2 years through a 4 year fix. What I'm doing is overpaying by the full 10%, one payment, at the start of the year, then saving up the overpayment in a regular saver account getting interest on it, until the next year where I overpay again.

So trying to sort of get the best from both worlds, savings interest and overpayment.

I've done numerous spreadsheets to prove that overpaying by full allowance saves more than spreading over monthly payments. The difference isn't huge over a short term, but in our case makes a difference of several hundred pounds over the term of the mortgage.

Also if your overpayment just goes out every month, then you don't get to earn much in the way of interest on it. But if it's saved up over a year and then paid, you're earning interest on that money while it's with you,