Can You Remortgage in Scunthorpe During a Fixed Term?
Remortgaging in Scunthorpe offers opportunities to save on mortgage payments or tap into the equity locked within your home. It’s a viable option for homeowners seeking to optimise their finances or release funds through equity release.
Many homeowners start the remortgage process in Scunthorpe around 3-6 months before their current mortgage deal expires. Some homeowners are uncertain about remortgaging during a fixed term, especially earlier than the typical timeframe.
A fixed term mortgage involves an interest rate that remains unchanged for a predetermined period, usually between two and five years. Throughout this period, you have a contractual obligation to maintain regular monthly mortgage payments.
In this article, we will explore the possibility of remortgaging in Scunthorpe during a fixed term and discuss whether it’s a viable option to consider.
When should you look into a remortgage in Scunthorpe?
Typically, homeowners in Scunthorpe aim to secure a remortgage for their property approximately 3-6 months before their existing mortgage deal expires.
This time frame allows ample opportunity for a mortgage broker in Scunthorpe to fulfill their role and ensures a smooth transition, as your new deal will be ready to commence when the old one concludes.
Remortgaging within this timeframe allows you to avoid being placed on your mortgage lender’s higher standard variable rate of interest (SVR), which often exceeds the Bank of England base rate.
The SVR typically remains higher than the Bank of England base rate and fluctuates at the discretion of the mortgage lender, often resulting in more expensive terms.
Opting for this route is unlikely to be the most favorable choice. Instead, your mortgage advisor in Scunthorpe will utilise this period before your current deal ends to search for suitable options tailored to your specific requirements, such as if you intend to remortgage for home improvements.
Can you remortgage in Scunthorpe during a fixed term?
Remortgaging in Scunthorpe during the fixed term, prior to the usual 3-6 month period, can be classified as an early remortgage. Technically, it is possible to engage in early remortgaging while still within the fixed term.
It’s important to consider that pursuing an early remortgage may result in incurring early repayment charges imposed by your mortgage lender. These charges arise from breaking the contractual agreement you entered into at the beginning of your deal.
While there are no specific restrictions preventing you from opting for an early remortgage, it’s crucial to weigh the potential financial implications of the associated early repayment charges.
Should I remortgage in Scunthorpe early?
Determining whether it’s advisable to pursue a remortgage in Scunthorpe during your fixed term depends on your specific goals.
It is always recommended to seek professional remortgage advice in Scunthorpe to assess your situation accurately. Typically, homeowners consider remortgaging when there is a valid reason to do so.
Common motivations for remortgaging include securing a better deal if you are currently paying a higher interest rate than what is available in the market. Additionally, remortgaging can help safeguard against potential interest rate increases and inflation changes.
Ultimately, the key consideration is ensuring long-term financial viability, taking into account the potential cost of early repayment charges.
It’s important to assess whether pursuing an early remortgage will genuinely benefit you or if waiting would be a more suitable approach. Evaluating the overall impact on your finances is key in making an informed decision.
Why don’t people usually remortgage in Scunthorpe early?
It is generally advisable to avoid remortgaging early during the fixed term due to the potential high costs associated with early repayment charges. The earlier you choose to remortgage in Scunthorpe, the higher these charges may be.
If the financial benefits outweigh the costs, and it aligns with your overall savings goals, early remortgaging could be a viable option. It is crucial to consult with a mortgage lender in advance to assess your individual circumstances and determine if this is the most suitable course of action for you.
Their expertise will help you make an informed decision about whether early remortgaging is the optimal route to pursue.
Can I remortgage in Scunthorpe early with the same mortgage lender?
While the typical understanding of a remortgage in Scunthorpe involves obtaining a new mortgage with a different mortgage lender, it is worth noting that you may have the option to stay with your current mortgage lender through a process called a Product Transfer.
Surprisingly, this option is often just as popular as a traditional remortgage.
Your mortgage lender, much like your mortgage advisor in Scunthorpe, may proactively inform you when your existing deal is nearing expiration, allowing you to plan for your remortgage in Scunthorpe. It is also possible to explore an early Product Transfer.
While an early Product Transfer may involve an early repayment charge, it can be advantageous in terms of lower fees compared to remortgaging with a new mortgage lender.
By staying with the same mortgage lender, you can potentially avoid additional legal costs associated with switching to a new mortgage lender for your remortgage in Scunthorpe.
Fees to Consider with an Early Remortgage in Scunthorpe
When you decide to remortgage, it’s important to be aware of the various fees involved in the process. This is particularly relevant if you are considering an early remortgage in Scunthorpe, as you will likely encounter an early repayment charge.
Early Repayment Charge
This charge is almost always applicable when you intend to leave your mortgage before the agreed-upon period, especially during the fixed term. The earlier you exit your contracted mortgage, the higher the cost of this charge.
It is imposed because you are breaking the contractual agreement you made with your mortgage lender regarding the repayment period.
Exit Fees
Exit fees are commonly associated with most mortgage types and are typically required upon fully repaying your mortgage. They may apply at the end of your full mortgage term or when you remortgage in Scunthorpe to a new deal.
Valuation Fees
Valuation fees are often associated with remortgaging in Scunthorpe, as they are incurred when you switch to a new mortgage lender who needs to assess the value of your property.
While some mortgage lenders may offer this service for free, others may charge a fee. Your mortgage advisor in Scunthorpe can provide more detailed information during your mortgage appointment.
Arrangement Fees
Arrangement fees, also known as product fees, are typically associated with specific mortgage deals. In many cases, you can choose to add these fees to your mortgage balance and pay them off monthly. Alternatively, paying them upfront is also an option.
It’s important to consider these fees and discuss them with your mortgage advisor in Scunthorpe to gain a comprehensive understanding of the costs associated with your remortgage.
How to Remortgage in Scunthorpe Before Your Fixed Rate Ends
Typically, most mortgage deals, including fixed rates, require a commitment of at least 6 months before you can consider remortgaging in Scunthorpe.
Therefore, the chances of being able to remortgage during this initial period are very slim, however, it is possible to remortgage in Scunthorpe afterwards, although it will come with higher fees the earlier you choose to do so.
To determine the specific fees involved, it is advisable to contact your mortgage lender directly. Additionally, seeking guidance from a trustworthy and qualified mortgage advisor in Scunthorpe is essential before making any decisions.
We recommend booking a free remortgage review, where a member of our experienced remortgage advice team can discuss your reasons for wanting to remortgage in Scunthorpe early. They will provide insights on whether it is more advantageous for you to wait or proceed with your plans as intended.
The Importance of a Remortgage Review in Scunthorpe
If you have been on the same mortgage rate since you first bought your mortgage, it may be time for you to look at cleaning your finances and having a remortgage review. Doing so could mean that you have access to a much more appropriate mortgage deal.
What is a remortgage review?
Simply explained a remortgage review is the process of looking at your current mortgage deal, making sure there have been no changes in circumstances and perhaps seeing if you are able to get a better mortgage deal or not.
When you make an enquiry about taking out a remortgage in Scunthorpe, your expert and dedicated mortgage advisor in Scunthorpe will want to know all about the deal you currently have, so that you can compare the different products available to you.
They will analyse your current rate of interest, all your monthly payments and your current financial and personal circumstances, to work this out. If your dedicated mortgage advisor in Scunthorpe is not able to find you a better mortgage deal, they will be transparent and say so.
Why should I get a remortgage review?
If you have been keeping up-to-date with all of your mortgage payments and have been working on building up your credit score to ensure it is in a good standing, it is entirely likely that you will be able to remortgage for a better deal.
Going through the process of a remortgage review, then switching your mortgage deal onto a new one with a new mortgage lender, is called remortgaging. You can do the same thing, but stay with the same mortgage lender and this is called a product transfer.
Depending on your personal and financial circumstances, you may be more suited for one than the other. In rare cases, you may actually find that you are better staying on your current mortgage deal and falling onto your mortgage lenders SVR, though it is more likely you will remortgage or product transfer.
It is important to remember that you are never guaranteed to be getting a better mortgage deal when you go for your remortgage review, though it is worth at least enquiring. Here at Scunthorpemoneyman, we offer a free remortgage review with an expert remortgage advisor in Scunthorpe.
What are the benefits of a remortgage review in Scunthorpe?
When you take up our offer of a free remortgage review a mortgage broker in Scunthorpe, your dedicated mortgage advisor in Scunthorpe will take on the bulk of the process, searching through 1000s of mortgage deals on your behalf, finding the right one for you.
If our mortgage advisors in Scunthorpe feel that a deal they have found will benefit your situation, they will present it to you. Once you are happy to proceed, we will progress to gathering documents and submitting your mortgage application.
For customers that prefer doing things on their own, you’ll find that comparison websites can help you find different deals, though you may not necessarily meet the mortgage lender criteria and there can be other costs that you have perhaps not factored in.
We have seen customers in the past, who have gotten in touch with us after previously switching onto a rate they saw online that had additional costs that they weren’t aware of, costing them a fortune. These can include set-up fees, early repayment charges and more.
Remember that whilst you can go directly to a mortgage lender, a mortgage broker in Scunthorpe will have much more to choose from with their vast panel of mortgage lenders. You will also, importantly, benefit from consumer protection.
Enquiring for remortgage advice in Scunthorpe from a mortgage broker in Scunthorpe can often be better for your situation. Mortgage lenders can only offer their own products, whereas a mortgage broker in Scunthorpe can cherry pick the best deal from multiple mortgage lenders.
Remortgaging and Early Repayment Charges
If you are currently tied into a specific mortgage deal and are looking to remortgage, unless your deal is set to end soon, you may need to pay a fee in order to do so. This is called an early repayment charge (ERC) and occurs when you move away from a loan too early.
Our trusted and dedicated mortgage advisors in Scunthorpe will take any ERC’s into account when assessing the benefits to you financially of taking out a remortgage. Of course it won’t always be appropriate, but there also may be times when it is.
Once your initial mortgage deal has concluded, you are likely to fall onto your mortgage lenders standard variable rate of interest (SVR). At this point (or in a few months prior to it), you probably won’t be paying an early repayment charge.
Your mortgage lenders SVR is typically much higher than your current fixed rate of interest and will track the Bank of England’s base rate, plus a percentage increase of their own. As such, it can be quite expensive to remain on this interest rate.
Remortgage Advice in Scunthorpe
We have a great deal of experience in the world of mortgages, helping customers to remortgage for over two decades now. Our team of remortgage advisors in Scunthorpe are only a phone call or booked appointment away, from helping you with remortgage advice in Scunthorpe.
Book a free mortgage appointment today and speak to an expert mortgage advisor in Scunthorpe. We look forward to hearing from you and helping you soon!
Help to Buy Mortgage Schemes
Help to Buy Mortgage Advice in Scunthorpe
After the unfortunate events of the 2008 credit crunch, the government needed something to try and bring the mortgage market back to prominence. One of the ways they did this, was introducing “Help to Buy Schemes” to help first time buyers onto the property ladder.
There are a various different Help to Buy Schemes available, some which may be more applicable to your circumstances than others. Here is a list of the schemes that may be useful for you.
Help to Buy Shared Ownership Scheme
The Help to Buy Shared Ownership Scheme was brought in to give mortgage applicants the ability to buy some of their property, and pay rent on the remaining percentage.
You will typically own between 25-75%, though this is not always the case. The remaining percentage is likely to be owned by a local authority, such as council or housing association. When you come into more funds, you may be able to increase the percentage you own.
The way that your payments work is that you will be paying both mortgage and rent. This basically means you are paying 100% of the ground rent and service charge on your home. This is still the case, even if you have the minimum share amount.
Bonus: Lifetime ISA
Though not technically a Help to Buy Scheme, the Lifetime ISA often is forgotten. It isn’t typically a first port of call, though it can be very handy for anyone looking to secure a property as a first time buyer in Scunthorpe.
It works as a type of savings account where your money can grow tax-free. The government will also top up your savings by a further 25%, so if you can meet the the £4,000 maximum amount, you will get a nice little £1,000 bonus.
You have to meet specific criteria in order to use the Lifetime ISA. More information about this can be found by clicking the link below or booking in to speak with a mortgage advisor in Scunthorpe.
Making an Offer on a Property in Scunthorpe
First Time Buyer Mortgage Advice in Scunthorpe
Once you are all ready to make your first offer on a property, it is important that the seller or the estate agent knows all about your personal and financial circumstances. Telling them all of your details give you a higher chance of being accepted.
Mortgage agreement in principle
99% of the times, you will never beat a cash buyer, lenders love less paperwork and a quick home buying process, which wouldn’t be the case if they had accepted someone wanting a mortgage. If you can’t afford to go down this route, to improve your chances of being accepted for a mortgage, you should get a mortgage agreement in principle prepared before you make your offer.
Having a mortgage agreement in principle at the ready shows that you have planned ahead and really want to secure this property. Whereas, if you don’t have one, your lender will know that you weren’t prepared and that you aren’t fully aware of how to apply, which could go against you.
This is why approaching a Mortgage Broker in Scunthorpe could really benefit you during the home buying process. Once you find a property that you are interested in making an offer on, Scunthorpemoneyman can quickly get you together with a mortgage agreement in principle. Depending on your situation, we can sometimes offer the same day service.
Don’t give up!
Buying a property is a negotiation process. If your first offer gets rejected, don’t worry, it’s perfectly normal to not be accepted first time round, you will get another chance to increase your original offer.
If your increased offer is also rejected, you may have to raise your offer again to match the asking price. If the property has just been listed on the property market, it’s unlikely that the seller is going to budge from their asking price. If you aren’t prepared to match their asking price, you may have to walk away and start looking for more properties.
To get a rough idea of what you may have to pay for your property, you should check out Zoopla and Rightmove and take a look “sold” prices of houses that are similar to the one that you are looking at. These prices are pulled from the Land Registry so they are reliable and can be used as a comparison.
You will sometimes see that some houses end up selling for less than their actual worth and this is because they could’ve been repossessed, sold to a tenant at a discounted price or an inter-family sale.
Speak to a Mortgage Advisor in Scunthorpe today
If you are still unsure about how to make an offer on a property and need help getting on the property ladder as a First Time Buyer in Scunthorpe, you should get the help off an expert Mortgage Advisor in Scunthorpe. They will do all they can in order to try and get that dream home of yours secured.
We are available 7 days a week, so if you ever have any mortgage questions, you know who to call. Receive a free mortgage consultation today with your expert Mortgage Broker in Scunthorpe.
What is a 95% Mortgage?
A 95% mortgage is as simple as the name would suggest; you are borrowing against 95% of the price of a property, and then you are covering the remaining 5% with your deposit. An example of this is if you looked at buying a property that was worth £150,000 with a 95% mortgage, you would be putting down £7,500 as your deposit and borrow the remaining £142,500 from the lender.
95% Mortgage Advice in Scunthorpe
Off the back of the March 2021 Budget, Boris Johnson announced a Mortgage Guarantee Scheme for mortgage lenders, making 95% mortgages more readily available from the bigger high street banks.
This is fantastic news for First-Time Buyers and Home Movers alike, as this scheme will continue running until December 2022. Certain terms and conditions will apply though, which is something your Mortgage Advisor in Scunthorpe will be able to look at, to see if you qualify.
All our customers who opt to Get in Touch will receive a free, no-obligation mortgage consultation where one of our dedicated mortgage advisors will be able to make a recommendation on the best possible route for you to take.
Can I get a 95% mortgage?
95% mortgages are usually accessible by both First-Time Buyers in Scunthorpe & those who are Moving Home in Scunthorpe. Whilst saving for a 5% deposit sounds like a pretty straightforward concept, you’ll still need to have an acceptable credit score and prove that you are able to afford your monthly mortgage repayments, in order to access a 95% mortgage.
Improving your credit score
A good credit score is essential in the process of obtaining any mortgage, especially a 95% mortgage. Things like paying any current credit commitments on time, ensuring your addresses are updated and checking that you’re on the voters roll, can all help with your credit score.
Affordability
Affordability is another one that is important to take note of. By giving the lender details of your income and monthly outgoings (things like your bank statements will be necessary for this) and any pre-existing credit commitments, your lender will be able to get a general overview of whether or not you are able to afford this type of mortgage.
Can my family help me get a 95% mortgage?
Nowadays we see lots of family members helping each other get onto the property ladder, especially parents looking to further their children’s lives. The way this usually happens is by gifting the person looking to find their home, the deposit required. Known through the industry as the “Bank of Mum & Dad, Gifted Deposits are only intended to be a gift, and not as a loan. The lender will need proof that this has been agreed, before it can be used towards your mortgage.
How do I choose the right 95% mortgage?
When looking for a 95% mortgage, you want to make sure you have the right type of mortgage. Each mortgage type works differently, with that choice allowing you to find one that is most appropriate for your personal and financial situation.
Some homeowners and home buyers prefer Fixed Rate or Tracker Mortgages, mortgage types which mean you either keep interest rates at a set amount for the term given or have your interest rates tracking the Bank of England base rates.
Alternatively, you might find that Interest-Only or a Repayment Mortgages are more your style. Interest-Only allows cheaper payments until you need to pay a lump sum at the end (mostly now used for Buy-to-Lets), whereas a Repayment mortgage (a normal mortgage if you’d like) means you’ll be paying interest and capital combined per month.
How can a bigger deposit help with my mortgage?
Seeing as a mortgage is such a large financial outgoing, you need to be prepared and need to be aware. You might find things like higher interest rates, remortgaging difficulties due to less equity and then negative equity all cropping up if you’re not.
There is no need to worry though, as all these can be avoided if you’re savvy enough with your process to begin with. The more deposit you put down for a property, the less risk the lender will see you as.
A larger deposit, of say 10-15%, would not only reduce the rates of interest by a noticeable amount, but would also give the property more equity and reduce the risk of negative equity, thanks in part to you borrowing less against the property.
So, whilst the risks may seem intimidating, planning ahead and saving for a bigger deposit to access something like a 90% or even an 85% mortgage will be a massive help in your mortgage journey and something you’ll be able to reap the rewards from in the future.
Scunthorpemoneyman Covid Update
Rishi Sunak’s second Budget as Chancellor brought two pieces of welcome news for the property sector as the Government attempts to transform “Generation Rent” into “Generation Buy” to help stimulate the UK economy, namely the new 95% Mortgage Guarantee and an extension of the Stamp Duty Holiday.
95% Mortgage Guarantee
The name of this scheme is misleading as not everyone that applies is guaranteed to be offered a mortgage, it is still subject to affordability and credit score. The “guarantee” itself is that the Government will ensure Lenders don’t stand a loss if they grant a 95% mortgage to a customer who then subsequently falls into arrears and is repossessed leaving behind negative equity.
This scheme should in theory give Lenders more confidence to lend even though the applicant only has a smaller deposit to put down. Of course, Lenders never want to repossess someone’s home unless it is the last resort, but if that happens then the new scheme would cover any shortfall.
Lenders have been worried about the prospect of home values decreasing so this measure should alleviate that concern although of course, the chances of negative equity occurring will naturally reduce should property prices increase as a result of these announcements!
The scheme is available to both 1st Time Buyers and Home Movers, it’s available on any property (not just new build) and will run until December 2022. Some major High Street Banks have already signed up to the scheme and it’s likely more will follow later on. It’s still a big challenge for Lenders to cope with the demand they are getting for mortgages due to the difficulties training and supervising staff working from home but they will want to offer as many of these mortgages as they can.
Stamp Duty Holiday Extension
When the Stamp Duty Holiday was launched last year we all hoped life would be very much back to normal by the cut-off date of 31st March 2021 but things didn’t pan out that way as we know. Solicitors are struggling to keep up with the workload and if lots of chains had collapsed then it would have partly defeated the object of the exercise.
Therefore it was good to hear the scheme has been extended to 30th June for purchases up to £500,000 and 30th September for purchases up to £250,000.
The Government certainly sees the property sector as an area that can play a big part in our economic recovery and if you are looking to buy a home or remortgage this year please reach out and we will be happy to advise you.
Getting Prepared For Your Mortgage in Scunthorpe
Mortgage Advice in Scunthorpe
So, you’ve saved up for your initial mortgage deposit, whether it be from your own savings or a gifted deposit from your parents. What’s the next step for you to take? It’s time for you to get prepared for your mortgage journey!
Know Where You Stand
First of all, we would recommend that you get in touch with an experienced mortgage broker in Scunthorpe as early on as you can, especially if you are applying for a first time buyer mortgage in Scunthorpe.
This is because you’ll be able to get a general idea of the costs and how much you could borrow. You should also look to get yourself an up to date credit report, to make sure you know you’re in good credit and are able to pass this on to your mortgage advisor in Scunthorpe.
The last thing you want is to have disputed payments holding you back, so it’s always handy to check in the early stages. Taking these steps will set you on a course where you have a good idea of what your budget will be and how likely you are to achieve mortgage success.
Agreement in Principle
Your mortgage broker in Scunthorpe will be able to get you an agreement in principle for you, on your behalf, typically within 24 hours of your initial mortgage appointment.
This helps you out greatly, as you will have this document to hand for making offers on properties. Having your agreement in principle shows the seller of the property and the estate agent that you are ready to go, allowing for a possibly quicker process.
Proof of ID & Address
There’s always lots of paperwork required for a mortgage process, so you’ll need to make sure you have a folder to keep all of these together. Two of these are your proof of ID and proof of address. For proof of ID you’ll need photo ID such as a driving license or passport.
Non-UK Nationals working in the UK will need to provide a Visa as well. For proof of address, you will need to use something like a utility bill or original bank statement that has been dated within the last 3 months.
You can also use your driving license, though it can only be used for one or the other. That means those using it for photo ID cannot use it for proof of address and vice versa.
Last 3 Months’ Bank Statements
The analysis of your spending habits will be one of the most important determining factors in whether you’ll qualify for a mortgage or not. You’ll need to provide the last 3 months bank statements, as that should evidence your income and regular expenditures.
Mortgage lenders will not be happy to see things like gambling transactions on your account, with the same being said if you go over an agreed overdraft limit or if your direct debits bounce regularly.
Proof of Deposit
For the purposes of anti-money laundering, you will also need to be able to prove that you do in fact have the funds in place for the deposit and where that money came from.
Try not to move money around various accounts too much, as it will make evidencing the audit trail more difficult. Mortgage lenders like to see your savings building up so you’ll need to account for any large credits that go into your accounts.
Quite often, the money for your deposit will be gifted by a member of your family. This is common with first time buyers in Scunthorpe. The funds for gifted deposits need to be evidenced, with the donor signing a letter to confirm it’s non-refundable and not a loan, purely serving as a gift.
A List of Your Expected Outgoings
It’s a good idea to do plenty of homework in advance and come up with an estimate of you expected outgoings once you have moved into your new house as a first time buyer in Scunthorpe.
You’ll need to work out things like council tax and what your general utility bills will be, as well as regular spendings such as food and drink, to be able to determine how much disposable income you will actually have available, to use towards your monthly mortgage payments.
As you can see from the above, it’s a real paper trail when you are applying for a mortgage, but if you want your application to run like clockwork you’ll need to put the time aside to get everything together.
Our view is that it’s better to get all this at the outset and collate everything that a mortgage lender could possibly ask for. This saves time and frustration later down the line. Book a free mortgage appointment today and we will help you to prepare as best as we can.
