Costs for remortgaging 7 November 2022 at 6:15PM in Mortgages & endowments 4 replies 312 views

shades03

We are looking at doing our first remortgage and plan to release some equity to pay off all of our H2B. With all the necessary fees and no fee to our mortgage advisor we are looking at nearly £2000 in cost. About £1000 of this is for legal fees. Does this seem high? With the cost of living im worried about being able to afford all of these costs that i wont be able to come off my variable rate. 

simon_or

£1000 conveyancing fee for a htb remortgage to a new lender doesn't seem overly excessive as it involves more work than a normal one like deed of postponement etc.

What's the remaining £1000 for? If it's the bank mortgage product fee, you could add it to the mortgage if cashflow is an issue.

And if cashflow is an issue, have you done the numbers to see if it's really advisable to pay off a low rate (less than 2%) htb loan with a 5-6% mortgage? Even if inflation ran at 8% every year for the next 5 years, the htb interest rate will be less than 3% in year 10.

chanz4

cost me under £600 with these the other month Conveyancing Solicitors - O’Neill Patient Solicitors LLP (oneillpatient.co.uk)

RelievedSheff

It is the HTB element that is increasing your costs.

Our last "standard" remortgage cost us nothing. We chose a fee free product and used the free legals service.

K_S

shades03 said:

We are looking at doing our first remortgage and plan to release some equity to pay off all of our H2B. With all the necessary fees and no fee to our mortgage advisor we are looking at nearly £2000 in cost. About £1000 of this is for legal fees. Does this seem high? With the cost of living im worried about being able to afford all of these costs that i wont be able to come off my variable rate. 

@shades03 1k conveyancing fees for an H2B remo is a bit on the high side for a freehold property, you could perhaps get it a couple of hundred quid cheaper with one of the larger volume conveyancers.

In most cases for remortgages mainstream lenders will offer a choice of free legals or cashback (and you can instruct your own conveyancer). 

Don't focus too much on whether or not the product comes with a lender product fee. As your mortgage size goes up it's often more cost effective to opt for the fee charging product as it's cheaper overall. With the vast majority of lenders, you can add this to the loan so don't need to pay it upfront.

As mentioned above, do the numbers and do think about whether you're sure about paying off the H2B equity loan, it may work out better to retain it. And if you aren't paying it off, and are with a mainstream lender, you could even look at product-switch options with your current lender so no conveyancing or underwriting should be required.