When a borrower moves a mortgage from one lender to another this is known as a re-mortgage.
The new mortgage will pay off the existing lender and sometimes the borrower may raise additional funds over and above the old mortgage amount.
With a competitive mortgage market, re-mortgaging has greatly increased in popularity and many borrowers usually re-mortgage to secure a competitive interest rate. It should be noted that re-mortgages carry costs and the borrower should also be wary of any redemption charges when considering a re-mortgage.
Remortgaging means switching your current mortgage for a new better mortgage, or raising additional finance by releasing the equity contained in your property. You therefore end your existing mortgage and switch to a new scheme.
Usually this involves switching lenders as most mortgage lenders will not offer a remortgage scheme to existing customers.
- Get a better rate of interest and reduce your monthly mortgage payments.
- Consolidate existing debts, loans and mortgage into one managable monthly payment.
- Raise finances to buy a new car, pay for your child's education, home improvement or a holiday.