When considering to re-mortgage your property, you may want to take into consideration the cost of moving from one mortgage to another. Below we give you a snapshot of the fees you may have to pay:
Arrangement and booking fee
This is a fee that a lender charges to arrange the new mortgage for you. Some lenders charge one fee which might be called an application fee, whereas other may charge both the arrangement fee and booking fee.
The rates for these can vary from lender to lender, and dependent on the deal (fixed-term, 2, 3, 5 years, etc) that you are interested in the fee could be lower or higher. Some lenders may offer a higher arrangement fee and low interest rate versus other lenders that offer a higher interest rate and lower arrangement fee.
You will need to work out what the cost of the arrangement fee will work out to be across the term you have agreed, and whether this will be worthwhile for you. This is where a good broker can come in handy, they can help you work out what the difference is in the long term.
To entice people over to re-mortgage with them, lenders offer to cover the cost of conveyancing as part of a new deal. This would usually come under the legal package.
However, if this fee is not included expect to pay a few hundred pounds for this.
Nowadays this will be included for free when re-mortgaging, however, there may still be certain lenders that charge an additional fee for this.
Some brokers charge to re-mortgage, which can work out to be 1-2% of the loan value or offer a fixed fee. Journey Mortgages is on hand to help you find the right deal.
Why would someone want to re-mortgage? There could be many reasons someone would like to re-mortgage, however, usually it is to that they can move onto a better deal, or consolidate debts, or carry out home improvements.
A key thing to remember with any mortgage is key advice from the FCA (Financial Conduct Authority) “your home may be repossessed if you do not keep up with payments”.
Journey Mortgages is a specialist broker that can help you with residential mortgages and more. Get in touch, and one of our friendly team with be happy to help you with your enquiry.