Why Do People Remortgage in Middlesbrough?

The act of taking out a remortgage in Middlesbrough is where you will be taking on a new mortgage to pay off and replace an existing mortgage that you have. This can be done for a wide variety of reasons.

A remortgage in Middlesbrough may not always be the appropriate decision for a homeowner, though it can be a great way for many homeowners to achieve any particular goals they have in mind, such as the ones we will cover here.

Reaching The End of Your Fixed-Period

As a general rule, when it comes to your mortgage, you will have some form of introductory or fixed period attached to your deal. Homeowners quite often will fix in for 2-5 years of their full term length, as this allows them to keep their interest rates and mortgage payments consistent for that duration.

When that period is set to come to an end, a homeowner will then usually look at the steps they have next, which most often includes a remortgage in Middlesbrough.

We personally will look to remake contact with our customers about 6 months before their deal is set to conclude, so we are able to run through the process in the background. This will hopefully allow for a seamless transition as your new mortgage starts as the old one finishes.

It’s important that you don’t look to remortgage in Middlesbrough any earlier than this (unless you have discussed with a mortgage advisor in Middlesbrough and it is deemed beneficial), as otherwise you would likely face early repayment charges.

Alternatives to a Remortgage in Middlesbrough

Before we look at why people may remortgage in Middlesbrough, it’s also important that you are aware of the alternatives. For example, some homeowners could instead look at their options for a remortgage in Middlesbrough to create more space within their home.

Whilst this could be a possible option, other homeowners may just look at moving to a new home instead.

Further to this, there is something called a product transfer. Whilst taking out a remortgage would see you taking out a new mortgage in Middlesbrough with a new lender, a product transfer is where you will switch onto a new deal, but stay with the same mortgage lender.

Last of all, if you are over the age of 55 and you happen to own a property that is worth at least £70,000, you could look at taking out an Equity Release plan. It is important that you have a chat with a qualified later life mortgage advisor in Middlesbrough to see if it is the right choice for you.

To understand the features and risks of equity release in Middlesbrough and lifetime mortgages, ask for a personalised illustration.

A lifetime mortgage may impact the value of your estate and it could affect your entitlement to current and future means tested benefits. The loan plus accrued interest will repayable upon death or moving into long term care.

That being said, a remortgage in Middlesbrough can still prove to be your best option and they can be useful for a variety of reasons. Below are some of the most popular reasons we hear of for homeowners taking out a remortgage in Middlesbrough on their home.

Remortgage in Middlesbrough for a Better Term or Deal

One situation that we come across quite frequently is a homeowner taking out a remortgage in Middlesbrough with a view to find a much better mortgage term or mortgage deal.

When your introductory or fixed-period comes to an end, you will move onto your mortgage lenders Standard Variable Rate, which will generally be at a much higher rate of interest.

It’s incredibly rare that an SVR will actually be better for you, which is why most people just look to remortgage in Middlesbrough instead, as it will likely be a better deal. They will use the equity in their home to access a lower loan to value, which should lower interest rates and monthly costs.

If you would rather pay back your mortgage much more quickly, you may also be able to keep your monthly mortgage payments the same, whilst shortening your overall mortgage term length. This could also possibly save you money, as there will be less interest for you to pay overall.

Remortgage in Middlesbrough to Release Equity

Every home has some level of equity sitting in it. This equity in your home will be the difference between the value of the property and what is left on your mortgage balance. As the balance starts to go down, the amount of equity will go up. If the value of the property goes up, so too will the equity amount.

Homeowners could also look at using this equity with a remortgage in Middlesbrough to release equity, which can be used for all kinds of reasons. Below we have listed some of the more popular options that homeowners use it for.

Home Improvements

As you go through your term, you may find that it is necessary to make changes to your home, especially if you’d rather not move and you really want to stay. We quite regularly chat with customers who want to remortgage in Middlesbrough for home improvements.

Whether you are looking to make a new home extension for more space, alter existing space within your home or remodel a kitchen, to name just a few examples, this can be a great option for homeowners in Middlesbrough.

Please bear in mind that the majority of mortgage lenders will probably want you to provide quotes for the work that is to be carried out, if this is something you wish to achieve with your remortgage in Middlesbrough.

Energy Saving Alterations

Following on from that point, homeowners may look to spend now and save later, by making home alterations that will help with saving on energy.

Installing solar panels has become quite a popular choice for homeowners in the way they generate their energy, as well as devices that convert wind into power. Wall insulations, replacing doors and windows are all great ways to reduce costs and be a little greener.

Debt Consolidation

Another common occurrence when looking at why some may look to remortgage in Middlesbrough to release equity, is for debt consolidation.

Whilst a remortgage in Middlesbrough to consolidate debts can work out really well for some, it’s not a decision that should be made lightly and we would recommend that you enquire for remortgage advice in Middlesbrough ahead of time.

A debt consolidation will see you merge your unsecured debts with your mortgage, into one manageable monthly payment. Though it will hopefully lower your monthly outgoings, it will generally cost more overall on interest, as that will be extended across your term.

You should think carefully before securing other debts against your home. By adding your unsecured debts to your mortgage, which is secured on your home, you are potentially putting your home at risk if you cannot make the required repayments.

Although the total monthly cost of servicing your debt may have reduced, the total cost of repayment may still have risen as the term of your mortgage is longer than it may have taken to repay the debts originally.

Gifted Deposit

Another frequent situation we hear of, as to why a homeowner may look to remortgage in Middlesbrough to release equity, is to provide a family member or friend with a gifted deposit. This is more likely to be found with parents helping their children buy their first home.

This gifted deposit can either be used as part of or the full amount of a home their child is hoping to buy. You will also have to sign a form that indicates it is not a loan and is solely a gift, as well as evidence of your funds and how they have built up.

Free Remortgage Review For Customers in Middlesbrough

If you are nearing the end of your introductory or fixed-period and are considering a remortgage for either of the options mentioned above, or even perhaps something else altogether, please feel free to get in touch and book a free remortgage review today.

You’ll benefit from taking out remortgage advice in Middlesbrough, that is provided by an expert mortgage advisor in Middlesbrough.

Date Last Edited: February 9, 2023