Remortgaging - impact of reducing the amount on the existing offer's interest rate

johnnybaloney

Hello,

The promo period of my current mortgage is ending in a few months. I'm holding off with overpaying as my savings account's interest is higher than that of the mortgage and also to avoid the early repayment charge. The plan is to leave a little window between the end of promo and remortgaging and during that window pay off as much as I can.

I'm not sure how much it's going to be so I will be looking for a new mortgage to cover the amount I owe now with the intention of securing the offer early in case the rates increase later.

I will then have to have the amount on the offer adjusted down by the amount I paid off.

Will it just be a matter of changing the figure on the offer? Or will this result in a new offer potentially with a changed interest rate as per the market condition at that time?

johnnybaloney

Had a call with a broker and they said that adjusting the figure to borrow happens at the actual remortgaging time during the redemption process. At that time the exact closing balance is taken from the current mortgage provider and that's the time you can reduce the amount to be borrowed if you wish so. You pay the difference to the solicitor and they handle the rest. No need for creating a gap between mortgages to make an overpayment.

grumbler

Do you really need a solicitor for remortgaging?

johnnybaloney

grumbler said:

Do you really need a solicitor for remortgaging?

I was wondering too. It's something I'm going to ask about when I speak with them again next week.

amnblog

Yes, if you are changing Lender, the Lender will want a Solicitor involved.

housebuyer143

grumbler said:

Do you really need a solicitor for remortgaging?

Yes, the new lender wants their searches or indemnity and interests looked after. They also don't want to send you hundreds of thousands of pounds trusting you to pay off your old mortgage...

johnnybaloney

In my case the new lender arranged for the solicitor themselves and paid for that too.

kingstreet

johnnybaloney said:

In my case the new lender arranged for the solicitor themselves and paid for that too.

Most brokers would recommend the cashback option and choosing your own solicitor rather than "free legals" as the service from the latter is largely poor.

johnnybaloney

I'll keep that in mind, thanks. In my case I went with L&C broker recommended on the MSE remortgaging pages and on this occasion the lender opted for O’Neill Patient Solicitors which happened to be the same no-frills company I used for the original mortgage and was quite happy with the experience back then. So I would've chosen them again for remortgaging now. This time so far the experience with them has been smooth and I can view the updates about all the steps in the process online which I like.