By the time your mortgage ends, you will have ended up with one of these outcomes; a dream family home, a stepping stone property you’ll later leave to climb the property ladder, or a buy to let investment property.
No matter which path you took primarily, soon enough you’ll find that your fixed period is ending. At this point you might be wanting to look at the options you have for moving into a bigger or smaller home. Sometimes a landlord may look to sell up their portfolio.
As a mortgage broker in Grimsby, however, we tend to find that most people will look to take out a remortgage.
Before we get on with the topic, let’s look at the definition of a remortgage in Grimsby. To summarise, a remortgage is the process of using funds that you have raised from taking out a new mortgage, to pay off an existing mortgage in your name. .You can do this a lot of different ways and there are a lot of different benefits to each.
The “Moneyman” Malcolm Davidson (host of MoneymanTV, our YouTube Channel) has well over 20 years of experience in the mortgage world. Using his knowledge, we have compiled a helpful guide to all the remortgage options that a homeowner may have access to.
Your fixed period will usually last within the range of 2-5 years. The fixed rates or potential discounted rates here tend to be lower. Depending on the situation you are in, you may even find yourself placed onto a tracker mortgage, which will fluctuate based on the Bank of England’s base rate.
Once you reach the end of your fixed period, you will most likely be put onto the lenders Standard Variable Rate (typically shortened to SVR). In simple terms, an SVR is a mortgage with an interest rate that can completely change depending on what the lender wishes to charge.
Whilst this mortgage type does not change with the Bank of England’s base rate as a tracker mortgage would. These changes often occur at times when the base rate or the market changes. For example, if the base rate goes up, your lender may choose to increase their rate too.
Because of this, Standard Variable Rates are often considered to be pretty expensive choices to stick with, which is why a lot of homeowners often choose to remortgage their property for better rates. The hope is that this will save you money down the line.
A couple of years into occupying your property, you may have something different in mind. Rather than finding a new place to live that covers what you would like in a home, many homeowners instead prefer to remortgage to release equity, in order to cover the costs of upgrading their current home.
We hear of customers looking to achieve all kinds of things in their homes. Some like to create more space to live in. Others are unhappy with their kitchen and would like it refurbishing. An increasingly popular one is converting the loft into another room or something else.
The prospect of planning and managing your own project, as well as getting permission from the authorities when necessary, can seem daunting. That being said, a lot of customers who have done just that would argue it’s a lot less stressful than finding a new house, and is a lot more rewarding.
This may benefit you further down the line too, as creating more space and having a solid, well built home is something that will likely increase how much the house is worth. In the event you did decide to sell up and move home, this would come in handy.
Depending on the situation you are in, you may just prefer to take out a remortgage in Grimsby in order to access a better mortgage term. This can be achieved either by reducing how long your mortgage term is or by switching onto a product that is more flexible.
When you reduce your mortgage term, you won’t be paying back, nor will you be restricted for as long. That being said, it tends to mean higher monthly mortgage payments for you. The longer you make your mortgage term, the less you’re likely to have to pay per month.
A lot of the time, customers may choose a more flexible mortgage term at remortgage time. This may give you the option to overpay more than usual (this comes with a cap typically), meaning you could pay your mortgage off quicker. Also if you wish to move, you may be able to carry that mortgage onto a new property.
Though this could be the best route to take, they will typically come in the form of tracker mortgages. As we looked at before, this will correlate with the Bank of England’s base rate. This means your monthly payments could be a little unreliable, as they may change.
Unless the country were to experience another serious market crash, every homeowner will have a certain amount of equity existing within their home. This can be worked out with the difference between what you still owe on the mortgage, and the value of the property.
As mentioned previously, people usually look at taking out a remortgage to release equity as a way of assisting with the funding of home improvements, though you may have something else you wish to use this for.
Popular choices include to cover long-term care costs, provide an income boost, cover the costs of a large holiday, pay off an interest-only mortgage or to simply free up some extra disposable income.
From time to time, we also find that Buy-to-Let landlords will look to remortgage to release equity from one of the properties in their portfolio, as a way to cover the deposit for a future purchase.
For homeowners who are aged 55+ and have a property that is worth at least £70,000, it may be beneficial to take at your options for Equity Release in Grimsby. Speak to a trusted later life mortgage advisor to learn more about lifetime mortgages and equity release.
Following on from the latter section, some may remortgage to release equity, to pay off any built up, unsecured debts.
Though it sounds simple, how much you can borrow for a debt consolidation remortgage depends on how much you owe a creditor, the value of your home and the current state of your credit rating. This means you could be limited in how much you are allowed to borrow.
In addition to this, in order to pay your previous mortgage off entirely, as well as the debts you have accrued, you will have to borrow more than you actually require for a mortgage. This will most likely mean higher monthly payments.
It’s not at all an ideal situation, but you’ll at least have comfort in knowing that should you find yourself struggling, there are some options out there that you can take.
If you have a damaged credit rating, you’re not completely out of options. That being said, it will be a challenge and you will require specialist remortgage advice in Grimsby before you can go forward with it. Even then, you are not guaranteed to get a mortgage.
Homeowners should always seek out the advice of a specialist mortgage advisor in Grimsby before they consolidate any debts against their home.
If you are reaching the end of your initial fixed period and wondering what your options may be for a remortgage in Grimsby, please do get in touch.
Book your free remortgage review to speak with an open & honest mortgage advisor in Grimsby today. We work around your schedule, so you can speak to someone at a time that is convenient for you, whether it be early in the morning or later in the evening.
A trusted mortgage advisor in Grimsby will be able to go over your case and any plans you may have, in order to create a suitable plan of action for your mortgage journey. We always aim to make sure that this time around is as quick, if not quicker than your last process.
Most people don’t even think about having a second mortgage, one stresses them out, never mind two! Having more than one mortgage can prove quite costly it certain cases. Surprisingly, with that said, they are a lot more common than you would’ve thought. Here are some reasons why people may want to invest in more than one mortgage:
Sometimes, people who have built up equity in their home may start looking for a second mortgage and this is because they want to release some of their equity to fund another purchase or something else.
If this is the same situation that you are in and you are thinking about releasing equity for a second mortgage, then you are going to need another mortgage deal to transfer onto. You can either search round for your own deal or go to a Mortgage Broker in Grimsby and they will sort it for you.
As a trusted Mortgage Broker in Grimsby, we have over 38 different lenders on panel, each with unique mortgage deals. We can shop around for you, searching through thousands of different deals until we match the perfect one for you and your personal and financial circumstances. Remember that lenders do not reward loyalty and will probably be offering better deals to First Time Buyers in Grimsby over you!
This is called Let to Buy, you have probably heard of it. Sometimes people want to keep their existing property and the mortgage so when the move home, they keep it with the aim to rent it out. When you are Moving Home and you decide to go down the Let to Buy route, your second mortgage will become your new residential one.
More and more First Time Buyers are struggling to take that first step onto the property ladder without a helping hand. We are commonly seeing more and more Parents and Grandparents helping out. The most common situations that we see is that either the Parents or Grandparents of the applicant give up their home and move out to get a second mortgage or they actually purchase the second home for them (kind of like a gifted deposit).
Are you interested in purchasing a second mortgage for a Buy to Let in Grimsby? If so, you should speak to a Buy to Let Mortgage Advisor in Grimby at Grimsbymoneyman. We have helped hundreds of local Buy to Let landlords secure amazing mortgage deals in the past and we want you to be next.
Get in touch and let’s get the process started for you and your Buy to Let second mortgage in Grimsby.
Are you currently named on another mortgage and would like to purchase a new property to live in? This situation is very common, and unfortunately, it is likely due to a divorce or separation. In situations like this, 9 times out of 10 we are able to help. Having a Specialist Mortgage Advisor in Grimsby by your side during this tough time could really help take all of the stress off your back.
We are able to search through thousands of second mortgage deals for you and we will work endlessly until we have that 1/1000 perfect deal for you. Receive a free mortgage consultation off one our amazing mortgage advisors today at Grimsbymoneyman, your local Mortgage Broker in Grimsby.
You may not be aware but most mortgages are portable these days. This portability means that when you are Moving Home, you can transfer your mortgage from one home to the next without a penalty. This is great if you have previously secured a fixed rate deal that you are still in the middle of and decide you want to move and take it with you.
Not all mortgages are portable, you should check with your lender or Mortgage Broker in Grimsby before putting your house on the market. If you have had your mortgage for some time or if it is with a specialist lender there is a chance it might not be portable, so bear this in mind when arranging your mortgage.
Sometimes, we find that customers don’t consider the porting options available to them. There are several potential reasons for this. Maybe the new lender will not lend them the extra money they need to fulfil the move. When you port a mortgage, you can only port the amount you currently owe and any additional borrowing needs to be placed on a deal from the lenders’ current range and that might not be competitive.
If you do port a mortgage and borrow extra monies, the additional borrowing creates something called a “sub-account”. In other words, you have one mortgage but with two different rates of interest applying to it, and it may not be as good as the rate you already have.
This can be a real pain because almost certainly the two products will “overlap” each other and as such it’s difficult to get these to line up without having to let one drift onto the standard variable rate for a while. Customers tend not to like having to change their mortgage deals as often as this and some of them decide to take the “hit” and pay an early repayment penalty to swap lender and get it all lined up.
Like any mortgage application, you will have to check to see if you are eligible to borrow more money if this is what you are looking for. Porting a mortgage can sometimes be difficult and may require Specialist Mortgage Advice from a professional who has lots of valuable experience in Moving Homes.
As a local mortgage broker in Grimsby, we offer expert advice regarding porting mortgages, so if you are struggling or need any type of mortgage advice, get in touch with our fabulous team.
We often receive calls from tenants informing us that their landlords are looking to put their property on the market, however, would like to offer the tenant the opportunity to buy the property first.
If the tenant is eligible for a mortgage and is in a position to purchase the property, this is usually the best outcome for both landlord and tenant. As if the tenant works close by or has children in the local school, moving would be an upheaval, to say the least. From the landlord’s perspective, it will save them time and money with selling fees.
Some tax reliefs were previously set in place by the government which helped landlords but due to changing times, these have been rolled back by the government. It is because of this that landlords are having to pay more tax meaning they are having no other option but to offload their investment property.
Whether the property is sold is to the landlords’ discretion. Some, such as serious investors, see it as a long-term arrangement seeing it as a sound investment from which they could benefit, whilst on the other hand, amateur Landlords will normally choose to sell.
There are many reasons why landlords would prefer to sell their property to the tenant rather than list it on the open market.
But there are advantages on both sides, such as to the tenant who is considering buying:
The advantages above means you’re able to obtain the property at a discounted purchase price. This is a popular route to sell for landlords and can sometimes be referred to as ‘Sale under Value’.
Some Lenders will allow any discount the Landlord is offering to you as part/all of your deposit. If the agreed price turns out to be well below the open market value it may even lead to the providential situation of tenants not having to put down any deposit at all.
We come across this enquiry quite frequently. In this scenario, you are more than likely a first time buyer in Grimsby and have lots of questions to ask. Our Mortgage Advisors really enjoy helping our customers every step of the way and putting your mind at ease throughout the whole process. Please contact us to discuss your mortgage options, we’d love to help you achieve your mortgage goals.
When customers like first time buyers in Grimsby have an offer accepted on a property your next job is to arrange a property survey. This will establish the condition of the property and ensure that it is worth what you are going to pay for it. If something is found on the survey you are then in a position by law to approach the seller to negotiate a price for the works required.
Here’s a short video from the Royal Institution of Chartered Surveyors (RICS) that explains the different types available to you.
There are 3 main types of property survey available to you:
A basic valuation is the cheapest option and you will be required to have one of these before you receive your mortgage offer. Please don’t confuse this with a full survey. The mortgage valuation confirms to the lender that the property is worth at least what it is lending you.
Your mortgage lender may even offer you a free basic valuation as part of your deal.
A Mortgage Valuation will not highlight any repairs that are needed. However, it may point out any obvious defects and recommend that you investigate further.
A Homebuyer’s report will cover structural safety and highlights problems, including damp, as well as anything that doesn’t meet current building regulations. This kind of report will give you an independent report of your property by an expert.
To ensure you are not paying for two surveys it is advisable to ask the mortgage companies surveyor to carry out this report for you – it will usually take a couple of hours to complete.
A Full Structural Survey is advisable for older properties and those of a non-standard construction.
Depending on the property size and type – a full structural survey can take as long as a day to complete.
A full structural survey provides a detailed report on the condition of the property and highlights issues that should be investigated further before going ahead with the purchase, providing you with peace of mind about the condition of your property.
You can find a surveyor to carry out a Homebuyer’s report or building survey through the Royal Institution of Chartered Surveyors.