remortgage Archives - KB Mortgage Services

Remortgaging checklist

Posted on August 2, 2022 at 11:58 am.

Are you approaching the end of your fixed period and want to get a better deal? Has your financial situation changed? Do you want to raise additional funds for home improvements? Are you currently sat on the Standard Variable Rate? Or perhaps you want to pay more or less on your monthly repayments? These are all reasons for wanting to remortgage your property.

Remortgaging is a much less involved process than buying a home, so it is often easier than you think. A good place to start is to have a think about what it is that you want to achieve by remortgaging. For example, if your initial deal has ended or about to end, then remortgaging can help you to secure the best new deal and help to save you money. You do need to remember though, that other costs need to be considered, such as set up fees (an arrangement fee, valuation fee or legal fees) However, you can often get lenders who offer deals with low or even no up-front costs.

Here are some steps that will help you make the remortgaging process as straightforward as possible and help prepare you:

Check your current mortgage – Have a look at what your current balance is on your existing mortgage and check what the term is on it. You’ll need to see if there is an early repayment charge if you were to switch deals. Either check your account online or ask for a redemption statement which will give you your current balance and situation.

Get a property valuation – It is important to understand what your property is worth so that you can calculate exactly how much you will save by remortgaging. The valuation will need to be realistic as the mortgage lender will send out an independent valuer which will confirm the valuation before you can proceed with your application. They may also do a desktop or automated valuation.

Check your credit history reports – This will have been part of your initial mortgage application, but you will also need to check they are correct now to make sure you are in a positive situation. Have a look here at my article on improving your credit score.

Make detailed notes of your incomings and outgoing and debts – Make sure you have the detail of your income which should also include your basic salary plus any bonuses split out. If you are self-employed, have at least two years of tax returns to refer to. Then write down any financial commitments you have such as loan payments, credit card balances, childcare, and other bills. This will help the lender work out an accurate affordability calculation based on your incoming and outgoings. Again, this needs to be an accurate reflection, you want to make sure that you can actually afford what you say you can!

Get your paperwork ready! – There are some standard documents that your new lender will want to see, so it pays to have these ready in advance so that you are well prepared. These may include:

• Your last three months’ bank statements
• Your last three months’ pay slips
• If self-employed: your last three years’ accounts/tax returns along with the corresponding tax overview forms
• Proof of any bonuses/commission if this is applicable to you
• Your latest P60
• ID documents (usually a passport or driving licence)
• Proof of address (e.g. utility bills or credit card bills dated within the last 3 months)

At KB Mortgage Services, we are well-equipped to help. We have access to the whole of the market, meaning that we can evaluate which lender and type of mortgage is best suited to your situation, to save you money.

But we’ll even advise you when remortgaging isn’t the best option for you. If you want to reduce your monthly payments, for example, we’ll figure out if the penalty fees associated with switching your lender early will be outweighed by the savings in the long run. If they will be, we’ll tell you so!

But if you do decide to go ahead, we’ll complete the paperwork, guide you through the process and keep you updated. And we’ll even keep in touch with you after you’ve completed, to ensure that the mortgage and protection plans you have in place always meet your changing needs.

So, if your mortgage is no longer suiting your lifestyle, or you want to see if you could save some money then get in touch.

Please note: You may have to pay an early repayment charge to your existing lender if you remortgage. Your home may be repossessed if you do not keep up repayments on your mortgage.

Approval No. Sol11962

Should I move house or remortgage to make home improvements?

Posted on May 11, 2022 at 1:13 pm.

Written by Jonathon Mckee-jones

It is well known that a property that suits your immediate needs when you first move into it might eventually become more limiting, which might prompt you to think about the options of moving house or renovating. Over the last few years, for example, with the trend to work from home more and more, a lot of people have required a more permanent office or study.

You might think that moving house is the only or best option, but it is surprising how renovations can transform your current home, so the question is: should you make home improvements?

There are some valid reasons why you might want to invest money into renovating your home:

To make your house more personal and fully centred around your current needs.
To create more space or convert space that you already have in order to accommodate working or family changes.
To update and modernize your home.
To make your home more energy-efficient.

What types of home improvements can you make?

Home improvements can include some fairly small tasks that add up to have a big impact on your house by freshening up a tired-looking house and making it more visually appealing. These include painting the walls and or doors, replacing sealant, installing new taps, changing lighting, and replacing tiles cabinets and worktops, to name a few.

Other more major improvements will be more expensive and cause more disruption, but the temporary discomfort will be worth it in the longer term. Examples of some bigger renovation projects include a loft, cellar or garage conversion, an extension, reconfiguring the layout of your house, a new kitchen or bathroom, adding a conservatory, replacing flooring, adding double glazing, installing a more energy-efficient heating system or some outdoor garden work such as a patio or decking.

Will it add value to your house?

Ultimately the amount that renovations can increase a property’s value will depend on the individual house and the local demand and what buyers want in that area. It is worth remembering that spending £10,000 on home renovations won’t necessarily increase the property’s value by £10,000! Some renovations may even devalue your home, so it is worth doing some research before you go ahead to make sure you are not damaging your property’s market value. If you are interested to find out what property features are valued in your area, then a local estate agent should be able to give you some insight on this.

A recent study conducted by Halifax indicated that a loft conversion adds the most value, increasing the value of a home by approximately £11,020.

Some of the other top ten upgrades, with the approximate value they add in brackets, are:

Bi-folding doors (£5,256)
Garage conversion (£4,847)
Renovated/restored period features (£4,731)
Extension (£4,129)
Under-floor heating (£3,961)
Add or remove garage (£2,610)

So, is it better to relocate or to renovate?

Although with money and some imagination there are a lot of changes that you can make to your property, there are still limits to what can be done. You can only add so much space and if you want an extra bedroom or bigger garden, then these could be almost impossible to achieve. In a similar way, renovations can’t remove space. So if you are rattling around in a big home once your children have flown the nest, you might want to consider downsizing or moving to a house that is more accessible if you are getting less mobile as you grow older.

There are a few things you will need to consider when making the decision to renovate.

Check if you will need to get planning permission.
For any larger home developments, get a structural survey to check for any limits or potential issues that may arise with the works.
Enlist the skills of specialists for major work such as plumbers and electricians.
Check if your renovations may affect your home insurance policy and make sure you tell them about any relevant changes.
Think about the disruption that the work will cause. You may even want to stay somewhere else while the work is completed.

Ready to renovate but how will you fund it?

A growing number of homeowners are turning to remortgaging to release funds in order to improve their homes and raise their value. A recent Natwest survey sound that now 6 in 10 homeowners are at least considering remortgaging to renovate. If the money for the building work is raised by remortgaging to release equity, then the eventual net cost to the homeowner may be low, zero or even negative, depending on how much value then gets added to the property as a result. So in the right situation, this could be a really good strategy for using a mortgage to improve someone’s overall financial position.

Remortgaging to renovate isn’t always the right move, but in the very best scenarios, it can be seen as a way to get ‘something for nothing’ by releasing capital from your home to boost your home’s resale value by more than it costs you – and all without increasing your monthly mortgage repayments.

If you have got some savings that you can put towards the renovation, you might consider using them. If you then also remortgage, you can afford to borrow a smaller amount.

Here are my top tips for remortgaging to renovate:

Check your home’s value – if it has risen in value since you bought it, then you can usually remortgage for a higher sum without increasing your monthly payments. However, if it hasn’t increased significantly then remortgaging might not be cost-effective.
Be aware of early repayment charges – an early repayment charge might set you back a few thousand pounds if you try to remortgage within a set number of years, so make sure you are aware of this first.
Look into the other costs of remortgaging – Don’t forget that taking out a mortgage can involve an arrangement fee, booking fee and valuation fee on top of an early repayment charge penalty, so it is important to know what these will be.
Keep an eye on your Loan to Value – In order to release the capital, you are borrowing more money which means you will end up paying more and it will take you longer to pay back the loan. The LTV will be increased which means that if the property price falls, you could end up finding yourself in negative equity.
Look at doing work which will increase your home’s value – If you are savvy and thinking about the value of your property as well as your home suiting your needs, you should look at renovations that will boost your house price by more than their cost. Extra bedrooms and ensuites often tick both boxes.
Use a mortgage advisor – Your current mortgage lender will want to keep you as a customer, but there is nothing to stop you from shopping around to find the best deal all round. A mortgage broker like myself has got access to a much wider range of deals, some of which will not be available on the high street and if you find that your equity has risen, you might be eligible for better offers than you think, which I will alert you to.

Call 07834 818805 or email [email protected].

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

You may have to pay an early repayment to your existing lender if you remortgage.

Approval no: Sol11626

How does remortgaging work?

Posted on March 2, 2022 at 1:11 pm.

Written by Jonathon Mckee-jones

If you already have a mortgage on your home and are looking to get a better interest rate on it or want to consolidate your debts into one payment, remortgaging may be a good financial move for you.

The process

It is a much less involved process than buying a home, so it is often easier than you think. A good place to start is to have a think about what it is that you want to achieve by remortgaging. For example, if your initial deal has ended or about to end, then remortgaging can help you to secure the best new deal and help to save you money. You do need to remember though, that other costs need to be considered, such as set up fees (an arrangement fee, valuation fee or legal fees) However, you can often get lenders who offer deals with low or even no up-front costs.

How long will it take?

As it is less involved than buying a new home, it is typically a quicker process but there are still a few steps to take and so you will need to plan ahead.

Step 1 – Shopping around

You will need to do your research and allow yourself plenty of time for this. Most lenders will allow you to apply for and then secure a rate for 6 months before you complete on it, meaning you can move straight over to your new deal as soon as your old one finishes. There are lots of products on the market and they can often disappear as quickly as they appear, so using a broker like myself, will help to speed up this search for you.

Step 2 – Decide on the deal for you

There are a few things to consider here and you need to think about whether you are happy with a variable rate, which goes up and down when interest rates change or if you would rather guarantee your monthly payments for a given period of time with a fixed mortgage. Consider any other fees involved along with the interest rate to make sure you are achieving your financial goals for remortgaging in the first place.

Step 3 – Apply

Once decided on the above, you will need to submit your application and will be required to provide your proof of income, proof of identification and details on your financial outgoings. In order to be prepared and save time, get together at least 3 months of payslips or 3 years accounts if self-employed, your passport or driving licence and bank statements for the last 3 months. Using someone like myself can save you time and make sure you get it right as I will help you through the whole process and deal with the lender on your behalf.

Step 4 – The assessment

In order to agree your mortgage, the lender will need to assess your income, financial commitments and outgoings to assess your affordability. As part of this they will look at your credit rating and do a valuation of your property to make sure it is worth what you have said.

Step 5 – The offer and completion

Once all of the above checks are completed and they are happy with the outcome, the lender will provide you with a mortgage offer. Your chosen conveyancer will complete all of the necessary legal work and then take the process through to completion, arranging the funds to be transferred to your previous lender.

If you are borrowing additional money, in order to consolidate other debts or to carry out some home improvements, this will be paid to you on completion.

We can help

Regardless of your reason for remortgaging, it doesn’t need to be stressful when you use an experienced mortgage broker.

But if you do decide to go ahead, we’ll complete the paperwork, guide you through the process and keep you updated.

And we’ll even keep in touch with you after you’ve completed, to ensure that the mortgage and protection plans you have in place always meet your changing needs.

So, if your mortgage is no longer suiting your lifestyle, or you want to see if you could save some money then get in touch.

[email protected]

07834 818805

Please note: You may have to pay an early repayment charge to your existing lender if you remortgage. Think carefully before securing debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

Approval no: Sol11349