If you’ve been thinking about remortgaging, this one’s for you. 

The world of remortgaging can be complicated, with acronyms and jargon galore. There are a few things to keep in mind to make sure you’re making the best choice for your financial situation. Read on to learn more! 

The first thing to do is read up on your current mortgage terms and check if it’s working for you. (If it ain’t broke, don’t fix it. But if it’s broke then it’s time to fix it!). Generally, people think about remortgaging when their fixed rate deal is coming to an end, so if this is you, it’s time to chat to a mortgage broker about your options!

Take a look at your interest rate, the monthly payments you’re making, and the type of mortgage that you have. Understanding your existing mortgage and what that means for you in practical money terms will help you determine whether remortgaging makes sense for you. 

Next, you’ll want to check your credit score. If you have a high credit score, you’ll be able to access better mortgage deals (and who doesn’t want a great deal?). If your credit score is low, it’s not the end of the world – you can take steps to improve your score before applying for a new mortgage. 

Think about your financial goals and the reasons why you want to remortgage. Is it because you want to lower your monthly payments? Do you want to access some of the equity for home improvements? Is your current deal coming to an end? Whatever your reasons for remortgaging, your life goals will influence the type of mortgage you choose. 

Take a moment to consider the long-term implications of getting a new mortgage. When you’re looking at the deals available on the market, calculate how much you’ll save or spend over the life of the new mortgage compared to your current one. Running the numbers will help you make sure that the benefits of remortgaging outweigh the costs, and will help you make a final decision. 

The best thing anyone can do is talk to a whole-of-market broker about their situation. They’ll be able to provide expert guidance and help you navigate the complex world of mortgages to find the solution that’s perfect for you. 

Remortgaging can seem scarier than Halloween, but if you weigh up the pros and cons and make sure to compare the costs and think about your long-term goals, you’ll be in the position to make the best decision for you and your situation.

Remortgaging is when a homeowner replaces their existing mortgage with a new one on the same property. 

There are lots of reasons why you might do this. For example getting a better interest rate, changing the terms of your loan, or accessing the equity that’s built up in your home. 

There are a couple of steps to remortgaging:

  1. Research and compare the different mortgage deals offered by lenders to find the one that suits you best. You can also chat with an independent ‘whole of market’ broken to help with this! 
  2. Once you’ve picked the lender and mortgage product that’s right for you, you’ll need to apply for the new mortgage. This means you’ll go through similar steps as when you got your first mortgage. So, you’ll need to provide financial information and do a credit check. 

So what happens next?

Once your application has been approved, the new mortgage pays off your existing one. Then you’ll start making monthly payments according to the terms of your new mortgage agreement. 

When deciding whether remortgaging will be worth it for you, you’ll want to consider all the fees and costs that come with getting a new mortgage. These could be arrangement fees, valuation fees and any early repayment charges or exit fees that your current lender might charge. 

Whether remortgaging is right for you will depend on your current mortgage terms, your situation, your goals, and the deals available on the market. 

It’s always a great idea to speak to an expert (like a money coach, financial adviser or mortgage specialist) about your options so you can be sure you’re making the right choice for you. 

For first-time buyers, navigating the housing market can feel like a daunting task. But there are a few strategies that can help make the process smoother and increase your chances of finding the perfect home. You got this! 

  1. Start saving early

One of the best habits to get into for first-time buyers is to start saving early. Saving for a mortgage deposit is a huge challenge for most people, so it’s important to come up with a savings plan and stick to it. Cutting back on unnecessary expenses and setting aside part of your income each month will help you build up your pot of money towards your house goal. If you know you’re going to be using the money for a house purchase, consider using a Lifetime ISA for free money!

  1. Speak to a mortgage broker

Find an independent mortgage broker who is “whole of market”. This means they can look at all the different lenders and assess the right one for your situation, as well as telling you how much you can borrow. Some mortgage brokers are free to use, some charge a fee, but most of them will have an initial fact finding session with you for free.  

  1. Get pre-approved for a mortgage 

This usually involves meeting with a lender who’ll assess your financial situation and determine how much you’re able to borrow. Your mortgage broker should be able to help you submit all your documents to the lender, who will produce something called a “decision in principle” (DIP). By getting pre-approved, you’ll have a really clear understanding of your budget and exactly what you can afford. So you’ll be able to focus your search on homes within your price range. 

  1. Patience and research are key

Lastly, it’s important to be patient and not rush into a purchase. Buying a house is one of the biggest commitments anyone can make in life. So it’s worth taking the time to view lots of different properties and compare all your options. When you do this, it’ll help you figure out what’s really important to you and give you a better understanding of what you’re looking for and what’s truly suitable for you and your lifestyle. 

While getting the keys to your first place is super exciting, the road to get there can be a long and winding one. 

First-time buyers often find themselves overwhelmed with the process as there are so many moving parts, endless acronyms and people to keep track of. But luckily there are a few need-to-knows that can help make the experience smoother. 

First and foremost, it’s crucial to have a handle on your budget. This involves getting a full picture of your finances – warts and all. When you review them, take a look at your income, savings and expenses. By seeing how much you can afford to spend on a home from the outset, you can narrow down your options and avoid the heartbreak of falling in love with a property that’s out of your price range. This also means you’ll avoid the trap of buying more ‘house’ than you can afford. 

There are a few government-backed options that are specially designed to help first-time buyers get onto the property ladder. For example Lifetime ISAs, the First Homes scheme, the 95% mortgage guarantee scheme, and Shared Ownership schemes. 

Doing your research into the housing market is also key. Familiarise yourself with the neighbourhoods you’re interested in, the average home prices, and the market conditions you’ll be facing. All of this will help you make informed decisions and could help you negotiate better deals. 

Another thing to be aware of is the costs that come with buying a home. Aside from the monthly mortgage repayments, there’s other costs to think about like the mortgage deposit, stamp duty, conveyancing or solicitors’ fees, survey costs, mortgage broker fees, moving costs, and potential repair or renovation costs if you’re buying a fixer-upper. So you’ll need to make room in your budget for all of these costs on top of your monthly payments. You can read more about the costs of getting a mortgage here. 

With the right amount of research and preparation, you can be confident on your journey to buying your first home. 

Do you know your deeds from your deposits? Your early repayment from your mortgage rate? When to remortgage and how? And what’s in store for mortgages in 2023? 

If not, you’re not alone! Whether you’re looking to remortgage, or the only mortgage you’ve ever had is in Monopoly, this 30-minute webinar is for you.

If you want to buy a home, chances are you’ll need a mortgage.

So a mortgage is just a fancy word for a loan that’s specifically for your home.

If your experience with mortgages up until now has only been when playing Monopoly, read on!

Mortgages can have a lot of moving parts and make you feel a bit lost – kind of like you’re driving around without GPS. And that’s why we’re here to break it all down and help you navigate all the costs – the obvious, and the hidden ones!

Deciding which mortgage lender to go with is just one of the costs associated with actually getting the mortgage. 

There are other fees involved in getting a mortgage that it’s useful to know about so you can budget for them. 

Below is a list of fees you might be charged as you take out your mortgage:

  • Arrangement fee: The fee you pay for the lender to set up your mortgage. This can cost anywhere between £0 and £2,000. The average is about £1,000. 
  • Booking fee: Paid up front when you apply for a mortgage deal. It’s often non-refundable even if your mortgage falls through. Usually this costs around £99 but can be up to £250.  
  • Valuation fee: Covers the cost of the survey of the property arranged by the mortgage lender. Some lenders will waive the fee and others charge up to £1,500.
  • Legal fees: Pays a solicitor to do the legal paperwork for you. This is often charged as a percentage of the cost of the mortgage.
  • Higher lending fees: You’ll only have to pay a higher lending fee if your mortgage is particularly large in proportion to the purchase price. 
  • CHAPS fee: Pays for your mortgage lender to transfer money to your solicitor. This fee is usually around £25-£50 and non-refundable even if the deal is not completed.
  • Financial advice fee: When arranging a mortgage, it’s common to use a financial adviser who will usually charge a fee for their service.
  • Own building insurance fee: Your lender might charge you a fee to check if you’ve taken out building insurance from a provider who isn’t them. This fee is usually between £25 and £50.

Getting a mortgage is a pretty big deal for most people. A good mortgage broker can be a really helpful guide on your home-buying journey. 

But what is a mortgage broker exactly? 

A mortgage broker is a person who specialises in mortgages. They’re basically an expert in mortgages. They’re the person who’ll help you find the right mortgage for your situation. 

How do I pick a good mortgage broker?

To help you pick a good broker, think about the following questions: 

1. How much will it cost me?

Brokers can make money in two ways: 

  • Receiving a commission from the lender. It doesn’t affect what you pay and will always be disclosed to borrowers. 
  • Charging you a broker fee. If your broker does charge you a fee, this can be anywhere between £500 and £1,000. 

Top tip – Avoid any broker that charges upfront or even before you complete your mortgage. In other words, don’t pay unless you get the mortgage.

2. Do you check all the lenders? 

Some mortgage brokers are tied to one lender or a small group of lenders. They’re not likely to get you the best deal because they can only offer mortgage deals from the lenders they work with. 

The real choice is between 1) a whole-of-market broker and 2) a direct mortgage lender. 

A whole-of-market broker is someone who checks all the lenders. However, some ‘direct only’ deals might not be available to them. While you pay for this service, every possible deal available is looked at.

A direct mortgage lender is the bank or building society that provides you with a mortgage directly. These basically cut out the mortgage broker and you might find the few extra ‘direct only’ deals that brokers can’t set up for you. There’s also the advantage that some of them are fee-free but you would be doing the work yourself to find these deals. 

3. Are they qualified?

In the UK, mortgage brokers must be registered with the Financial Conduct Authority (FCA), in order to be authorised to give mortgage advice. This is required by law. When looking at any UK mortgage broker, check the FCA’s Financial Services Register for their name.

You can check  www.vouchedfor.co.uk or www.unbiased.co.uk to find a mortgage broker in your local area.

So you want to buy a house! Congrats! 

What happens next?

The chances are, you’ll be needing a mortgage.

There are different mortgage structures – this has to do with the rules and details of your mortgage. For example the amount of time your loan period is and the interest rate you’ll be paying. 

There are also loads of options for mortgage repayment methods – this has to do with how much you’ll be paying and when.

Here’s a quick guide:

Mortgage structures

There are two main types of repayment structures. This just tells you how you’ll be making your payments.

Capital repayment: With this your monthly repayments are calculated so you’ll have repaid all the debt and the interest over the term you agree. It means your monthly payments cover both the interest and chip away at the actual debt, so at the end you owe nothing. Most mortgages these days are capital repayment.

Interest-only: Here you just pay the interest during the term. This means your monthly repayments will be significantly lower. But they don’t reduce your actual debt – they just cover the cost of borrowing that money. So for example, when the term (let’s say it’s 25 years) is up on a £150,000 mortgage, you would still owe £150,000. Interest-only mortgages are hard to get these days as you need to show a solid plan for paying back the money you borrowed.

Mortgage repayment methods

There are many different types of deals you can get, but all fall roughly into two camps. They’re either fixed or variable.

Fixed: The interest rate stays the same for an agreed period of time, usually between two and five years. This means your payments stay the same and it’s easier to predict your monthly outgoings and budget for them. 

Variable: Here your mortgage rate, as the name suggests, can and usually will move up and down. The major, but not the only cause of this, is changes to the UK economy. Whether the UK economy is doing well or not so well can affect these rates.  

The interest rates available to you will depend a lot on what’s happening with the economy when you’re looking to buy a house. The most important thing is to get a mortgage with a rate that you can afford to pay back. You’ll need to look closely at your budget to see how much per month you can realistically afford. 

Now that you know what a mortgage is, how do you go about getting one?

Preparation is key with a mortgage. This is where you get to pave your way to a smooth ride. 

First, maximise your chances of getting the best mortgage deal 

  • get your credit score as good as it can be
  • save as much as you can to put down as a deposit – be prepared to show lenders proof that you have the deposit.
  • gather proof of your income – typically 3 months of payslips or 2-3 years of your accounts if you’re self-employed. 

Next, decide who’ll find the best deal for you. 

There’s two main approaches: 

  1. Use a broker 

A mortgage broker is a qualified and regulated adviser. They offer their services to help you find a lender that will grant you a mortgage. They’ll take information on your financial situation and your needs to explore the market. Then they can apply for a mortgage for you. They may charge a fee so it’s important to know how the deal they find you has saved money. You’ll want to know this so you can compare this with doing it yourself. You can ask them to explain this.

  1. Do it yourself 

If you’re confident you know what you want, there’s nothing to stop you getting a mortgage on your own. As a starting point, you can use comparison websites to compare rates.