3 Tips for Choosing a Remortgage Lender

With so many advertisements promising the best remortgage deals at the lowest rate, how do you choose the one that’s right for you? You can begin by performing a little pre-search preparation.

First, develop an idea of what you are looking for and why. The clearer you are on your objective, the less likely you are to be steered into a loan that doesn’t suit you. Next, sharpen your mortgage IQ so that you and your mortgage adviser can stay on the same page. You will want to familiarize yourself with remortgage terms so that you fully understand what is being said and done. Here are some additional tips to help you along the way:

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Know Your Lenders and What Type of Service Each Can Provide

While one lender may advertise a more attractive interest rate, you may find that they do not offer the program you seek. An easy example is the choice between using a bank or direct lender versus direct remortgage brokers. A bank may have fewer choices and lower rates, but the process could be lengthier and more bureaucratic. A broker may have access to a wider range of programs with the flexibility you need, but it may cost you more, since the broker and the lender are both looking to make money on your deal. Choose what resonates with you.

Check into Your Potential Lender’s Customer Service Practices

During the remortgage process, you may get little to no insight regarding what your new lender will be like. You could be in for some surprises down the road. Some lenders are notorious for poor customer service and mortgage account errors.

Thankfully, you can obtain a glimpse of what the customer service experience may be like with your new lender ahead of time. Talk to friends and family about their experience. Go online and investigate their website and read reviews.

Narrow Your Loan Program Preference Before You Go Remortgage Shopping

Of course, you can still be open to the suggestions of your mortgage adviser, but you can avoid being overwhelmed by so much new information. You will also have a basis for comparison and will be able to ask better questions.

If you prefer payment stability over the life of the loan, then you may decide to go with a fixed rate program. If the trend is toward falling interest rates and you are comfortable with change, then you may be a perfect candidate for a tracker mortgage. It offers the potential for lower payments if the Bank of England base rate goes down. Or you may be interested in an equity release or the home reversion remortgage package.

You can research the basic qualifications for each loan program before applying for a remortgage. It’s also a good idea to inquire about the cost of completing your loan, including the broker fee, valuation and survey fees, arrangement fees, legal or administration fees, and in some cases, remortgage redemption penalties (early repayment fees). When you’re prepared for the remortgage process, it can be a truly rewarding experience.