*For the most up to date information on this topic, please see: Five ways to get your remortgage right
With the country in lockdown and fighting COVID-19, it’s natural for us to concentrate our efforts on getting through it as unscathed as possible. While our health – and those of our fellow citizens – should be the main concern, it’s our responsibility to look after our financial wellbeing, too. After all, when the crisis is over, the economy may be in a very different state from when it started.
If you’re a homeowner, one way that could save money or allow access to extra funds is by remortgaging with another lender. While it’s not possible for everyone to remortgage – you may be liable for penalty fees if you redeem your mortgage before your current deal expires – you could pay less in monthly mortgage repayments. If you’ve got three to six months left on your current deal, it’s something you should be looking at, despite the current crisis.
At present, the Bank of England’s base rate is at an all-time low of 0.1 per cent. After a period of adjustment, some big lenders have now reduced their mortgage interest rates which means you may be eligible to a lower rate than you would have been before the crisis.
While the current mortgage market is healthier than you might imagine, it’s wise to keep things in perspective. Lenders have brought rates down to attract new customers, but they’re still cautious about who they lend to – overall applications are down. Before agreeing a new mortgage, they’ll look at your monthly outgoings and personal debts to judge what level of risk you pose. The lower your loan to value is, which is the amount of equity against your required loan amount, the more preferential rate you may be eligible for.
Away from the financial side of the process, other aspects have changed, too.
With the current lockdown, getting your house valued isn’t as straightforward as it was previously. Despite the easing of restrictions on physical valuations being undertaken, there is, at the time of writing, a backlog of applications which will take priority over new applications. However, the good news is that many lenders are also willing to use automated or desktop property valuations rather than sending a surveyor round to physically inspect your property. If you’re with an independent mortgage broker like Charles Cameron, we’ll be able to tell you which lenders are offering this. We can also guide you through the conveyancing process: again, something that can be done without you having to meet in person.
Expertise in the mortgage market is never more vital than at times of flux. At Charles Cameron, our years of experience will help you get a deal that’s not just right for you now – but also over the long term. While face-to-face meetings are temporarily inadmissible, we’ll be happy to conduct the process over email and phone, or through our own video- meeting platform.