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What Do I Need to Remortgage?

Ashleigh Williams

Written by

19th Oct 2022 (Last updated on 28th Oct 2022) 9 minute read

When it comes to remortgaging, there's a lot to consider. A remortgage will take time to process. As a result, you will need to plan in advance to allow yourself the opportunity to secure the best deal.

There is a process to follow and specific documents are required. In this article, we will be providing you with a step-by-step guide on this process, including what do you need to remortgage.

This article will cover the following:
  1. 1. Get Ready to Remortgage
  2. 2. Look at Remortgage Deals
  3. 3. Find out How Much You Can Borrow
  4. 4. Learn What You Want From A Remortgage
  5. 5. Gather Documents For a Remortgage
  6. 6. Hire A Conveyancer or Solicitor
  7. 7. Complete Agreement in Principle
  8. 8. Remortgage Applications
  9. 9. Valuation
  10. 10. Receive Offers and Complete
  11. What Stops You Getting A Remortgage?

1. Get Ready to Remortgage

If you're wondering how to get a remortgage, the best way is to plan in advance and give yourself enough time to prepare. There is a lot to consider, especially when it comes to finding the best deals. This is why it’s best to plan in advance. Here are some things you’ll need to consider:

Early Repayment Charges or Exit Fees

If you’re looking to leave your mortgage early, this will likely incur early repayment charges or exit fees. This occurs when you’re still legally bound to your contract with the tie-in period.

Our research shows you can expect to pay between 1-5% of the total property value in addition to the deed release. The Deed Release fee is typically around £175.

The longer you have left on your mortgage contract, the higher the early repayment charges will be. While not all lenders will charge this, the majority tend to.

This set time can vary depending on the mortgage and the lender. This is why it’s helpful to plan in advance and check the details of your contract.

Solicitor Fees

The average cost of solicitor fees for remortgaging according to our research is £1,078.

If you're looking to remortgage with a new lender, you'll need to enlist the assistance of a remortgage conveyancer or solicitor.

While the prices to remortgage are a lot lower than receiving your initial mortgage, there are still some costs to consider.

Here are some of the average costs you may expect to pay your solicitor:

  • Legal fees - £720 including VAT
  • Search fees - £290
  • Electronic bank transfer fee - £40
  • Electronic ID check - £20
  • Title deeds copy - £4
  • Land Registry fee - £4

Admin Charges and Additional Fees

According to our research, the average remortgage fees are around £3,553. There are admin charges and additional fees you will need to consider when applying for a remortgage.

Some estimated charges you can expect to pay are:

  • Mortgage arrangement/Product fee (administration charge) - £1,000
  • Mortgage booking fee (to secure your loan) - £180
  • Valuation (to value the property) - £770
  • Mortgage broker/advisor fees (if applicable) - £200
  • Stamp duty (only applicable if the legal title of the property is being transferred) - Based on the price of the property. Use our Stamp Duty Calculator to calculate this.
  • Transfer of equity (for title deed changes) - £570
  • Unregistered land (for properties not registered with the land registry) - £180
  • Landlord’s registration (for buy-to-let remortgages) - £100
  • Management company notice fees (for new ownership and changing lenders) - £300

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2. Look at Remortgage Deals

After considering the extra costs of remortgaging, you’ll want to decide whether you’re able to get a better deal by remortgaging.

In most cases, remortgaging can provide you with a better deal, but, this will be based on current interest rates which are often changing.

In the current climate, interest rates are rising, and this could affect the types of remortgage deals available. You should always speak to a mortgage broker about your current financial situation. They can then find the best deals for you.

Remortgage rates can change and the remortgage process takes time. Because of this, it’s often recommended to begin searching for a new mortgage deal around 6 months before you want to remortgage. This allows you enough time to plan.

3. Find out How Much You Can Borrow

Before you apply for a remortgage, you need to know how much you’re able to borrow. This will help to better understand the remortgage options available.

A lender will calculate the amount of money you can borrow, but it’s useful for you to know this beforehand. You can work with your mortgage broker to find this out.

A mortgage broker and lender will look at aspects such as your income, the value of the property, equity and the average amount of money you spend.

4. Learn What You Want From A Remortgage

Before applying for a mortgage, it’s useful to know what you want from your remortgage. There are many reasons why someone may remortgage, from changing the type of mortgage to releasing equity.

The reasons behind remortgaging will ultimately have an effect on the type of mortgage you can have. It’s important to have a clear understanding of these reasons before spending money on a mortgage broker. They will be able to advise you on the best type of mortgage for you from here.

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5. Gather Documents For a Remortgage

There are many documents you need for a remortgage. You'll need to have your current mortgage details, including:

  • Your outstanding mortgage balance
  • Your mortgage terms
  • Your monthly mortgage repayments

Here are some of the most common documents lenders will expect to look at:

  • Bank statements and payslips (at least 3 month’s worth)
  • Three years of accounts (if you’re self-employed)
  • Your address for the previous 3 years
  • Proof of address (most commonly utility bills)
  • P60 tax form
  • ID (passport or driving licenses are the most common form of ID used)
  • Credit card statements (if applicable)
  • Any subscriptions or outgoings that are regular
  • Bonus and commission records (if applicable)

While these are the most common documents needed, this isn’t an extensive list, and you may be required to provide other necessary documents too.

It’s useful to have documentation of any planning permissions you have for the property as lenders will need to see this.

6. Hire A Conveyancer or Solicitor

If you’re choosing to stay with your current lender, it’s unlikely you'll need the help of a conveyancing solicitor. This is because the lender will have your current details and will just be moving you to a new deal.

If you’re moving to a new lender, it’s useful to enlist the help of a remortgage conveyancer or solicitor. A solicitor will handle the legal side of a remortgage. They're an important part of the process and will help ensure everything is completed correctly.

Many lenders have their own conveyancers and solicitors, but it can be possible to use your own. The solicitor will handle legal aspects such as the contract, your completion date, checking ID, and land registry.

7. Complete Agreement in Principle

Once you have everything you need to begin the remortgage process, you can then seek to receive an Agreement in Principle.

A lender will consider things such as your income, the property, and your deposit. If they’re happy with the figures, they'll provide you with an Agreement in Principle. While it’s not a guarantee in terms of lending, it will provide you with a better idea of who will offer you a remortgage deal.

It’s useful to receive the agreement in principle from the lender you’re interested in remortgaging with. This will help speed up the process. It’s not typically recommended to have multiple Agreements in Principles.

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8. Remortgage Applications

After receiving an Agreement in Principle, you can then begin to apply for the remortgage deals of your choice. In general, it’s not recommended to send too many applications.

This is because it can affect your credit score if this is done in a short period. These hard searches carried out by lenders can have a negative impact on your credit score.

9. Valuation

When you’ve applied for a mortgage, your lender will carry out a property valuation before agreeing on the remortgage deal. This determines whether they’re happy to lend the specific amount of money requested to remortgage.

In some instances, the amount of money they’re willing to lend can be lower than expected. If this is the case you can work with your mortgage broker to display why the property value may need to be increased.

10. Receive Offers and Complete

If the lender is happy with the valuation and your remortgage application, they will then offer you a remortgage deal. Your solicitor will then handle the legal side of this and ensure everything is in order.

The solicitor and conveyancing process times will vary depending on the type of property, and the remortgage offer.

On average, the remortgaging process takes around 4-8 weeks to complete and change to the new mortgage deal.

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What Stops You Getting A Remortgage?

There are some reasons why you may be denied a remortgage. Even though you were accepted for your initial mortgage, remortgaging is based on your current financial status. This may have changed since your previous mortgage.

The following aspects are taken into consideration:

Your Credit Score

If you have a good credit score and a positive history of keeping up with repayments, this will put you in good stead for approval.

If you miss payments, especially if they’re mortgage repayments, this will have a significant impact on your ability to be approved. If your credit score has decreased, it can be possible to make improvements to this over time.

You should speak to a financial advisor or mortgage broker to find out the steps you may need to take.

Debt

If you’re in debt, it’s more likely you'll be denied the opportunity to remortgage. This is because lenders will see you as a higher-risk investment.

Income Changes

If you've been made redundant, quit your job, or are on a lower income, this can potentially have an impact on remortgage opportunities.

It’s unlikely a lender will be willing to lend as much if they think you can’t afford the mortgage repayments.

Given that income doesn’t play a part in your credit score, it may not affect your opportunity to remortgage. However, affordability plays a role, and income changes will have an overall impact on this.

Affordability Concerns

As discussed, affordability will have an impact on your ability to remortgage. If a lender feels you’re incapable of paying your mortgage repayments, they can be reluctant to approve the application.

This is why it’s so important to have your finances in order before you apply for a mortgage. Your outgoings and income are assessed in order for lenders to determine if you’re capable of meeting the mortgage repayments.

Missed Payments

If you have a history of missed mortgage repayments, this will likely impact your future opportunities. This is because lenders will want to approve people that will keep up with repayments.

Each remortgage is a risk for the lender, so they want to ensure they're receiving the payments each month.

High Loan to Value

The value of your property has a significant impact on your ability to remortgage. If you have equity in your property, this will be helpful. If you’re in negative equity, this can impact your remortgage.

Lenders will look at your Loan to Value (LTV). If you borrowed a higher amount and now the property has decreased in value, the percentage of the money you have borrowed will be increased.

If the LTV percentage was 80% when you purchased the property, and it’s now 90% for example, lenders may not want to lend money at such a high percentage.

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Disclaimer

All data, research, facts, and figures have been taken from reputable sources and government data that was accurate at the time of writing. Any information featured in this guide should not be relied on or regarded as an authoritative statement of law. While we aim to ensure that all information is accurate, we make no representations about the suitability or reliability with respect to the website as well as any products, information, or services that are featured on the website. Mortgage criteria, policies, and interest rates change regularly and vary depending on the lender and type of mortgage you have. You should speak directly to your mortgage lender for clarification. It should be noted that your home may be repossessed if you cannot keep up with your mortgage payments.
Ashleigh Williams

Having written book reviews and content for For The Love of Books for over five years, Ashleigh now creates advice articles for Compare My Move, focusing on all things home-related.

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