How do I remortgage to release equity
Do you have enough equity in your property to be able to release some? If the answer is no then the process stops there as many lenders will only lend a certain loan to value of the property.
For most lenders they will only offer up to 80% of the value of the property. The reason for this is to ensure that borrowers don’t end up in negative equity and that the lenders don’t lose out. The risk is much lower to the banks and building societies if they only lend up to 80% LTV. If something were to happen to the property market tomorrow and prices dropped you wouldn’t want to end up owing more than your property is worth?
As an alternative to getting a second mortgage in addition to your existing mortgage you could of course start over and re-mortgage.
Is it easy to re-mortgage?
This question depends on a number of things that lenders will want to know as part of the application.
- Whether there is enough equity to release and the value of the property.
- The income of the applicant/s and whether it is enough to support a larger mortgage.
- The affordability of a larger mortgage.
- What the equity release is for – it will need to be for something such as home improvements that will add value or other reasons like debt consolidation or financing further education.
The process, like anything, can be hard especially if you are time poor and confused by all of the products, with not enough time to do your research.
What can I borrow?
As lenders will only lend around 80% of the value of the property you need to ensure that you get a good valuation.
Don’t just pick a figure that you think the property is worth because if you get it wrong and overestimate it you will just be wasting your time. On the other hand you may be underestimating what your property is worth and find that you can borrow more.
Get a proper valuation and then base your numbers on 80% of that. If your property is worth £240k you will be able to borrow up to £192k. If your existing mortgage is much less than that it will be a substantial sum.
How do I go about it?
Applying for a mortgage has probably changed considerably since the last time you applied. In recent years new rules have been bought into force to protect individuals after the financial crisis caused debt misery for so many. Now the process is much stricter and the products much fairer. Where once you could borrow up to 100% of the value of your property now the limits are set so that in the face of another crisis you won’t be left in negative equity. Affordability now needs to be proven and a thorough spending analysis carried out before a mortgage can be offered. There are also many products on the market which can leave people confused as to which is right for them.
That’s why we recommend that you come in and have a chat with one of our experts. We will sit down and look at your circumstances and what it is you are looking to achieve and then we can advise on the right products for you. You can leave everything to us whilst you get on with your busy life.
Our ReMortgage Service - Why choose us?
Special features of what we offer include:
- Get the best remortgage deals in the UK
- Whole of market service - we work with most UK lenders
- Access to leading market mortgage rates
- Access to exclusive loan deals not available on high street
- Fast turnaround - speak to us today if you need to move quickly
- We have lenders who will take into account previous defaults and missed payments
- Looking to raise additional finance on top of your existing mortgage or buy to let mortgage? - we have access to a range of finance solutions
To investigate your remortgage options to release equity call our mortgage team on 0117 403 4474 or fill in our call back form.