Published at 14:34, Friday, 29 June 2012

When you come to the end of the special deal period on your mortgage, it’s worth while looking to the market to see what else is currently on offer.

Many lenders are keen to attract new borrowers with a large amount of equity in their homes, and who are able to demonstrate a good payment history.

Remortgaging can be a good way to escape high variable or fixed interest rates and take advantage of some of the current fixed-rate, tracker or discount mortgages, which may well have much lower rates.

It can also be a way to raise some funds for an expensive purchase. If you have owned your property for a few years, it could be worth significantly more than your outstanding mortgage. By taking out a new, larger mortgage you can release some additional funds to spend as you wish.

Remortgaging may also appeal if you are currently on a variable rate and are concerned that interest rates may rise in the short to medium term. You can move to a fixed-rate deal before this happens.

Some care is required as remortgaging could cost you some additional outlay, and before applying for a new deal you need to check how expensive it is going to be. The following are some of the areas that you should consider.

Arrangement and administration fees for the new mortgage. These can vary considerably from lender to lender so it is well worth shopping around.

A mortgage valuation may be required. The type needed will depend on a number of factors and your new lender may well include this free of charge as part of the new deal.

Check whether you have an early redemption penalty on your present mortgage. This could be considerable if you pay the mortgage off in full within a certain period of the start date.

Legal costs. Again your new lender may pay any standard charges as part of the package, but it is worth checking to ensure that you will not be liable for any additional costs

If it’s been a while since you last took out a new mortgage, you may find that the options available to you now include offset and flexible mortgages. These deals give you greater options when it comes to managing your mortgage – for example giving you payment holidays or underpayments, as well as the chance to increase your monthly payments or to make lump sum payments if times are good.

If you are taking advantage of the opportunities that these types of mortgages bring, you can allow them to fit in with any fluctuations in your lifestyle.

The Cumberland offers a hassle-free remortgage service. For details please call into your local branch or visit www.cumberland.co.uk.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Published by http://www.cumberlandnews.co.uk