According to industry data, the number of remortgages in February 2017 rose by 35% to almost 44,000, which is the highest it’s been since January 2009. Remortgage lending equated to 37% of all lending in February, and some market experts believe this strong start to 2017 will continue.
Why the Increase?
Over the past few years many people have decided not to remortgage, instead taking advantage of the low interest rate. For some people their standard product or fixed term will have come to an end, but they’ve been happy to remain on the standard variable rate.
However, more recently we’re seeing really competitive deals emerging in the market as lenders tempt customers to remortgage and take out a fixed rate now. We have also seen more speculation over a potential interest rate rise which may be a contributing factor for the increase in volume.
Customers have the dilemma of: should we remortgage with a product and fix the deal for, say, 5 years, or should we wait? According to the market, those individuals who are able to take out fixed-rate mortgages are starting to do so.
When to Remortgage and How long Will it Take?
Remortgaging your property is a relatively straightforward process. You should discuss your requirements with your financial advisor and ensure you have the right deal to meet your circumstances before you proceed.
Your advisor will provide you with different options and products, and explain any early repayment charges, arrangement fees payable or broker fees. They will also assess your credit score and affordability, together with the term of the mortgage which is most suitable for your needs.
The mortgage deals on the market at the moment may not meet your requirements or be suitable for you. Do not feel that you need to rush to remortgage until you understand the implications and costs involved. You will be in a better position if you are informed of your choices.
How Much Does a Remortgage Cost?
Your financial advisor may recommend a legal firm to manage the legal side of the remortgage process.
Your new mortgage lender may also recommend a legal firm as part of the offer, usually termed as ‘fees free’. However, the legal firm may only represent the mortgage lender. So if you require advice or if there is any other work not included in the ‘fees free’, you will be responsible for the additional costs. On occasion these fees may increase dramatically.
You should ensure you are fully aware of any additional fees which may be charged at the outset when choosing a legal representative. Such fees may include a charge for paying off your existing mortgage, sending you any balance of funds, dealing with a leasehold remortgage and checking your source of funds if there is a shortfall.
You should also be aware that you are usually not under any obligation to accept the ‘fees free’ option offered by your new mortgage lender. Most lenders will have relationships with legal firms through a panel manager or a direct relationship. As the remortgage market is increasing you need to ascertain if the chosen firm will have capacity to manage your case to your required timeline. You can speak to your financial advisor and ask if the lender will provide a ‘cash back’ to enable you to choose your own legal firm as part of the deal.
Once the mortgage product has been chosen, ensure the legal firm representing you can meet your requirements and any deadlines you have. If you have selected the ‘cash back’ option or are choosing your own law firm, ensure the firm is on the lender’s panel and are able to act for you and the lender.
How Long Will it Take?
A straightforward remortgage should take only a matter of weeks to complete once the legal firm receives the instruction. You will usually receive a questionnaire to complete from the legal firm and a request for further information, such as identification. The sooner you can complete the documentation, the sooner the law firm will be able to proceed.
For more information on the remortgage process see What is a Remortgage?
Can Co-op Legal Services Help Remortgage?
We work with expert Conveyancing partners who can undertake straightforward remortgages in a matter of weeks. We have carefully selected our partners to ensure you have a positive customer experience. We are not linked to any panel managers and work directly with our Conveyancers to inform you of the cost, timeframe and service expectations.
Our partners are on all major lending panels and work to agreed timelines to ensure your case is prioritised and progressed as soon as possible. We’ll keep you informed of progress throughout the transaction.
At Co-op Legal Services we believe in transparency, meaning the quote you receive is the legal fee you pay.
If you are thinking of remortgaging use our calculator to get an extremely competitive quote, please click here and select Remortgage.