A remortgage involves the taking out of a fresh mortgage sometimes (but rarely) with the same lender or more usually with another lender.  You should not confuse a remortgage with a further advance, which is borrowing an additional amount from the same lender you are currently with, or a second mortgage (usually referred to as a secured loan) which normally arises when security is taken by another lender, such as a bank or finance house, to provide additional finance to someone who already has a mortgage.  Please click here for more information regarding 'secured loans '.

Before considering matters further however, we must emphasise that the remortgage market has been thrown into utter chaos as a result of the credit crunch.  Until recently when the end of a particular product came about, the obvious action was to look for a remortgage rather than automatically tranfer to the lender's standard variable rate.   However, in many cases at the present time it is often better to do just that - transfer to the standard variable rate and wait for better products to become available.

Why do people remortgage?         Just some of the reasons................................

1. To get a better rate of interest than is available from their present lender or because their requirements are such that the present lender will not provide satisfactory terms.
2. Because additional finance required is not available from their existing lender.
3. The most common reason is to amalgamate the existing mortgage and various credit and other finance outgoings and sometimes to provide additional cash for any purpose required into one manageable payment.

We always advise our clients to re-examine their financial position every two years at least.  It's easy to slip into the habit of seeing standing orders and direct debits passing through our accounts each month without stopping to think if a complete re-assessment might not be a good idea.  Over the years we've been able to transform many people's life style - those who've been sometimes struggling to make ends meet for years, when a simple discussion with ourselves could alter things completely.

Alternatively you may have a particular project in mind - a major extension, purchase of a second property, or require finance for practically any purpose.  It really does make sense to have a word with us first to discuss the possibility of a remortgage before considering any other way forward.

And the second part of the question - what are the costs?

Nothing like those connected with the original house purchase fortunately!  There is no stamp duty as there may have been when you purchased your property.  Indeed we have facilities available where there is no charge for any survey that is required and often legal charges are free also - or a substantial contribution is made towards them. However an annoying feature(one of many unfortunately) of the credit crunch is that at renewal, some lenders are offering a better rate than would apply if the mortgage transferred over to the standard variable rate, but at the price of a substantial admin fee added to the mortgage. Before agreeing to such a transfer (which might have the carrot of lower monthly repayments) the effect of the admin fee charged should be considered.

In many cases (bearing in mind that we do not  charge fees either!) however, it is still possible to remortgage without any fees being charged at all, but as always the overall cost should be looked at carefully.  That's why we are here - to answer your questions - and if it is better for you to stay with your current lender at renewal rather than transfer to a new lender we will certainly tell you.