How To Remortgage in the UK | Equity Release Remortgage Process in 2022 | Home Owner Tips UK
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- čas přidán 27. 07. 2024
- Talking through my recent remortgage process and all the steps taken to switch to a new mortgage deal and release equity.
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0:00 - Intro
1:58 - What is a remortgage?
2:50 - What’s wrong with a standard variable rate mortgage?
4:08 - Why we got equity out from our remortgage
5:13 - Remortgaging options
7:06 - Mortgage broker or not?
11:08 - How to calculate how much equity is in your property
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It's great to have you here! This channel is all about sharing my journey to financial peace and freedom, and I share all the things I am doing, not doing, and everything I am learning and unlearning on the way.
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Great Video, it’s been 2 years again. I would really enjoy a part 2
Haha yes! Funny you say that as I just completed a product switch and am going to make a video about it 🙂 planning to have it up either this weekend or next so stay tuned!
Very helpful and sufficient info provided.
Thanks for this video.
Thank you for this Video. Perfect timing for me so I’m taking notes❤️
Awesome! Hope all goes smoothly for you 😊
Really useful video thank you for braking down the steps in a relatable way!
My pleasure 😊
We're now being affected by the rise in base rate so this video will be very useful as I'm being forced to have to look into the whole process 🙂
This was an awesome informative video, with great content from you, and an incredible space for others to likewise share their journey and findings ❤🎉
Thank you ♥️
So interesting! Our process here in Australia is quite different - so fascinating to see how differently this is done around the world
That’s interesting, I’d be intrigued to know how it works in Australia. I love learning about different processes across the world too!
V excellent explanation
Thank you!
Thanks
Hi u sort of helped my fear because I dont know what's up thank u amen
Glad you found this video helpful 😊
Great video Dee, my 2 year fixed rate ends in June so my mortgage advisor and I have started the process and I will go back on another 2 year fix.
Yes hopefully you can secure in a good rate for the next 2 years. Interest rates are definitely pretty good right now.
Thank you for this video, it was very insightful! Going to remortgage for the 1st time in a couple of months and we're also planning to release equity to extend/renovate the house. It would be awesome if you could share how did you budget for your extension/renovation works, I'm trying to come up with a budget plan/spreadsheet, but I'm not sure how to start.
That’s exciting! Will definitely change the way you live in your house for the better. One thing that was really helpful was using a spreadsheet to track EVERY single expense as we went along (include date of spend, how much, who to, etc.). We knew roughly what we wanted to spend but of course it all can change very quickly with a build.
Top tip is to add an extra 10% on top off whatever your builder quotes you to cover contingencies. I probably will end up doing a video on this but just wanted to say a few things ahead of time to help you on your way 😊
@@FinanceDee🔥💎
Mortgage broker fees have put me off using them though! . Starting fees for remortgage have ranged £1025- £495 for 5/2 years fixed deals. Thats on top of the valuation fees, transfer and administration fees,etc 😤. Just need to be prepared. Thanks for the video
Wow that’s an unusually high mortgage broker fee. There’s always London & country which is fee free. I also had my valuation fees covered by my new lender. There’s definitely ways to get the costs down.
@@FinanceDee in fairness it was for 2 BTLs whose fixed rates were ending at the same time. But thanks for sharing London & County.
Thank you for your very calming video. I’m barely starting the process now and hadn’t realised I needed a conveyancer and solicitor, let alone physical valuation. Sounds intrusive! How did other people get a desktop valuation?
You’re welcome! I was shocked too and found it very intrusive. Apparently it depends on the lender and the situation. So another lender I was going to go with first would have done a desktop evaluation only.
There is a distinct difference between the "Standard variable rate" (the one everyone reverts to at the end of a mortgage contract period and a "discounted variable rate" traditionally when you're re-mortgaging the variable rates are more favourable because there is an added risk to the borrower.
Sometimes it's worth getting your hands on a lifetime tracker. Note many Advisors like to offer them because you are no longer a repeat customer, but the key reason they are good is you will have a cheaper mortgage than the standard variable rate, there is no longer a 1k set up fee every 2 years and also the contract period is usually zero and overpayment options are unlimited.
Remember, the term period and the contract period are two completely different things. Always get as long a term as you can, you can always overpay.
Interesting! I’ve just done a small bit of research based on your comment but I am seeing that the discount variables rates aren’t as good now generally as they were in years past. Plus it seems they only last 2-3 years?
@@FinanceDee Hi Dee, there have definitely been some changes over the years. I'm on a lifetime discounted tracker currently. I pay 1.49% above base rate with no overpayment charges and no contract obligation. Furthermore, I also don't need to pay a product fee every 2 years any more. However, I have done a little digging myself after watching your video and provided you have a good LTV, Lloyds do a fantastic 1.66% fixed for 10 years !. Certainly something to consider if interest rates continue to creep up. I have 13 years of mortgage left, so that is possibility a good option for me. Keep up the great work, Dee !
@@stuartb3690Hi, how would you calculate 1.66% on a Mortgage of £100,000 please?
£100,000 + 1.66% ?
@@stuartb3690So that would be an extra £1,660 interest added onto the £100k Mortgage?
Yes , or 5k for a 5% and so on. I was very lucky and I got the 1.66 fixed for 10 years. With the money I have saved , I reinvested that amount into a S&S isa.
Thank you for sharing your experience. I also took out some equity when I last remortgaged and used the fund to extend the lease on my flat. I need to remortgage again this year and am looking for a broker so please let me know if you recommend the one you used.
I definitely recommend my broker. Email me at financedee@outlook.com and I’ll pass on his details.
@@FinanceDee thanks!
Hey, great video!! Question, did the bank need proof of what you wanted the money for?
Thank you! They asked what it was for, but never verified it interestingly!
Im sticking for a variable rate. Im aiming to pay moreeee than just 10% overpayment in a fixed rate deal
Good for you looking to pay more than 10% 👏🏾 are you hoping to switch to a fixed deal if rates come down next year?
Very interesting video.
I’m quite new with the UK property mortgage market which is very different from European scheme.
My fix rate is now coming to an end .
So I’m wondering if it’s worth drawing out equity if you don’t intend to do renovations/extensions or buying an other property for example.
Always good to speak to a reputable mortgage advisor to run through your options, but my opinion is that it’s absolutely not worth taking out equity you’re not going to increase the value of the house through renovations or invest it somewhere else ESPECIALLY with how interest rates are now.
My video coming out this Sunday is about what I am doing to prepare for my next remortgage funnily enough so look out for that 😊 thanks for watching!
@@FinanceDee What about if the property value has already gone up with recent extensions and upgrades ?
It all depends on what your financial goals are. If you don’t take equity out it just means you’re leaving it in the house which isn’t a bad thing.
You should speak to a mortgage advisor because then they will be able to show you your options and monthly repayments if you do vs. don’t take equity out. I can give you the name and number of my mortgage advisor if you’d like.
We were on a 3 year fixed rate and are coming to the end of outlet term. We are keen to draw out some equity from our property as have been assured by property agents around the area that the property price has gone up. This is to buy a new property which would be our home. Any cons of doing so?
It would be good to speak to a mortgage adviser to assess all your options really. But just keep in mind when you take out equity, it’s likely your monthly payments will go up because you owe more on the house again. And with the rise of interest rates you’ll need to weigh up if it’s worth it.
Hi, thank you for such a great informative video. So are you saying that the reason why you chose s fixed term mortgage for only 2 years, because you knew you had plans to Remortgage??
So basically, anyone who isn't planning on Remortgaging, you wouldn't suggest to gry such s short term fixed rate mortgage?
Yes that’s exactly why we chose to only do 2 years is because we knew we wanted to take some equity out to do our extension.
Now with interest rates how they are, I would have loved to secure for 5 years instead of 2 this time.
So this means the number of years on your mortgage are up in comparison to what it would have been (had you not taken the equity out)?
Good question. You can decide that depending on how much you can afford in monthly payments. We decided to go from 30 years to 28 years to stay in keeping with what it would have been.
@@FinanceDee Okay. So you opted to pay a bit more than what you would have done monthly (had you not pulled the equity out)?
Yes, so we are now paying an extra £50 a month on our mortgage than we were before. But if we didn’t take equity out we would have been paying about £150 less than we were before. So I guess that’s technically £200 more a month than if we remortgaged and didn’t take equity out, but only feels like a £50 difference to us because it’s similar to what we were paying before.
Hope this helps!
Thanks for the video really helpful and informative. I have a doubt if you could please clarify for me.
For instance I have purchased a flat for 300,000£ and have put up a 10% deposit (30,000£).Now I get 2 years fixed term mortgage and let’s say I pay 1400£/month. Now after 2 years if I wanna remortgage and buy another house of 400,000£ and sell this one, then how much will be my mortgage value on the new house and will I get my deposit back?
Just wanna know the figures.
Thanks.
Hello. I can’t provide exact figures because there’s no crystal ball but the concept is if you were to sell the first house you would get whatever equity you have in the house at the time. Equity will depend on how much you have left on your mortgage and how much the house is valued at the time of selling. Remember, house prices can go up and down, so there’s no 100% guarantee that you would get all of your deposit back if the value of your house went lower than the amount you paid for it.
Understood, thanks very much.😊
Nice chat. Can one get equity after just 4 yours of mortgage?
Anyone can get equity provided everything lines up (your affordability at remortgage, sufficient equity built up, etc.). We got ours after 2 years.
So are you paying the first mortgage monthly payments and the second home equity loan every month … or did the second home equity loan cover the first mortgage so you only have one monthly payment in regards to the house?
It was a remortgage where we had the option to keep it the same or borrow more, and we borrowed more. So it’s just one payment and just shows as one mortgage amount.
@@FinanceDee thank you for taking the time out to answer ❤️
@@crowningglory6654She didn't Remortgage for 2 Different properties, that's why it's still all just 1 Mortgage, but at a higher rate due to the Remortgaging, because when you Remortgage, the interest rate goes up on how much you have to pay back monthly ❤
Insert:
If it was a Remortgage to buy an additional house, then yes there would be 2 different mortgages
If I buy my home by cash buy, can I do mortgage 1 or 2 years after the purchase?
You should be able to do speak to a mortgage advisor to help you through that.
Did you find the valuation was in line with what you thought?
Yes eventually. They first undervalued it (by about £15k) and then I had to send them proof of what other houses in the area sold for that were like mine and they then increased it by £15k.
How do I contact you