Despite
the fact that interest rates are at an all-time low, more people than ever have
to remortgage their properties and homes because banks and lenders have raised
their SVRs, or standard variable rates, from 4.24% to 4.74%. In the future,
other lenders might raise their standard variable rates, mainly because the
rates private lenders charge are not associated with the Bank of England’s
mortgage base rate.
Check
your credit
Before you jump into remortgaging, make sure you check
your credit rating. Obviously, banks are less willing to remortgage those with
poor credit ratings. In the past, things like a missed credit card payment did
not matter much when it came to reworking a mortgage, but in this recessed
financial climate, a questionable rating can damage your ability to remortgage.
Learn
about the options When you meet with your lender you will be presented with
different types of mortgage deals. Acquainting yourself with these options in
advance will make the remortgaging process a much easier one. For those with
budgetary constraints, a fixed rate deal is probably your best option. Taking
on a fixed rate remortgage plan means you have the knowledge, and perhaps the
benefit, of paying the same mortgage fee every month. If you are looking for a
lower rate, at least in the short term, a variable rate plan is the one to go
with. Although interest rates are not projected to rise in the near future, you
need to be sure that you have the income or savings to pay off any sort of
interest increase if you remortgage with a variable plan. There are two types
of variable rates available: tracker and discount. A tracker mortgage is
directly related to the base rate SVR, which is determined by the Bank of
England. Your rate will only change when the Bank changes its base rate, so it
is a very secure plan. Alternatively, discount rates correspond to your
lender’s standard variable rate, and are therefore subject to change whenever.
Be
realistic and communicative Most people are deeply connected to their houses in a
personal, meaningful way. The home’s personal value, however, does not
translate into any monetary market value. To secure a favourable rate, though,
you will need to put a fair amount of your dwelling’s equity into the deal in
order to qualify, so having an objective understanding of your dwelling’s value
is crucial. Finally, if you are unsure
what mortgage plan is best for you, be open and honest with your lender. They
will help you come up with an SVR and plan that will allow you to pay your
mortgage comfortably and consistently.
0 comments:
Post a Comment