What to Consider When Remortgaging for Home Improvements

If the value of your home has increased substantially since you bought it, then remortgaging it might enable you to tackle some home improvements, such as installing glass balcony railings. For home owners who have enough equity in their property, this can be a cost-effective way of raising the finances.

The mortgage market may be starting to pick up, but the best deals are still reserved for the less risky customers. Before you take any steps towards remortgaging you should consider all the eventualities carefully and ensure that this is something you can afford. The more equity that you have, the better the deal you?ll be able to get. You will also require a good credit rating regardless of whether you choose to stick with your current lender or look elsewhere.

Put Together All the Information

You need to start thinking about a remortgage well in advance, especially if you want it ready for when your current deal ends. Make sure that you have all the relevant documents to hand, such as mortgage details and bank statements. You need to think about how much you can afford to pay back each month, especially if the interest rate was to increase. If you were to over-commit yourself and the rate increased dramatically, you risk losing your home.

Look at the Costs Involved

If you?re looking at remortgaging before your current deal runs out, then you need to be aware of any early-repayment fess that you will be liable for. If these are too high, it might make remortgaging unviable. There are also the exit fees and any costs of the new mortgage to take into consideration. In order to get a clear picture of exactly what you will have to pay, you should speak to your lender for a breakdown of all the costs.

Research the Market

You can talk to your current mortgage provider about remortgaging, but it?s also worthwhile seeing what else is out there. There is a choice of fixed, variable or tracker deals, depending on your individual circumstances. You should consider your own priorities and whether there is any leeway in your monthly budget or you prefer to know exactly how much you?re spending every month. Look at comparison sites, speak to lenders or deal with a financial advisor to ensure you know what?s available. Take into account any legal, application or valuation fees when you?re pricing up individual deals.

Apply for a Mortgage

Whether you want to have glass balcony railings fitted or build an extension, you need to have the mortgage finalised before you can go ahead with anything. The lender will send you an agreement in principle before going ahead with a survey to check the value. Once you have a mortgage offer, they will liaise directly with your lender to finalise the process.

The whole process can take considerably longer than you imagine. If you are considering a remortgage as an option for home improvements, then you need to start as soon as possible.