Remortgage Question

KillTheKeyboard

Hi,

When remortgaging, am i transferring the whole amount I owe including my previous lenders APRC - as an example (80,000 borrowed + 70,000 interest) or just what I borrowed (80,000) onto the new lenders APRC? Keeping in mind what i've already paid off, of course.

I am obviously new to all this and just looking to get my head around it all, as I have with previous topics.

amnblog

You are replacing the outstanding balance plus any fees or penalties for settlement.

Thrugelmir

You transfer the owing mortgage debt, i.e. the capital balance. Interest is charged as and when it falls due. As a result any repayments you make are a combination of capital and interest. Only the capital element reduces the debt owed. Over time more of your monthly repayment goes towards reducing the capital balance. This is why in the early years of repaying a mortgage progress does seen slow.

KillTheKeyboard

So minus any exit fees, in this example, I am only transferring the 80k to the new lender? Which is the capital debt?

Thrugelmir

Correct. There'll be a mortgage exit fee to pay to the old lender in addition to the capital balance. Interest will be calculated to the date the mortgage is redeemed.