Unlock the potential in your high-value property with a remortgage. You can benefit from significant savings with a better mortgage deal or raise capital to enhance your property or invest elsewhere. As a high net worth individual, you may have a complex remortgage requirement, multiple income streams and assets you wish to utilise. Many lenders offer flexible remortgage solutions so that you can make the most of a new deal.
What is a remortgage?
Remortgaging your property involves replacing your existing mortgage with a new deal. This can either be with your current lender or a new one. The process is much easier than buying a new property. This is because you’re already named on the deeds and are simply switching to an alternative deal. If you choose to stay with the same lender, it should be a fairly quick transaction as the lender already has your information. Should you prefer to switch to a different lender, you will need to pass their affordability criteria.
How can remortgaging benefit you?
There are several reasons to consider remortgaging your high-value property, including saving money or raising cash.
Save money
Your mortgage is a huge financial commitment and a remortgage can allow you to streamline it. You may have benefitted from a competitive fixed rate over a short term but that term is now coming to an end. Unless you transfer your deal to a new one, it will switch to your lender’s standard variable rate, which is usually a lot higher. You should begin searching for a remortgage deal approximately 3 to 6 months beforehand to ensure you find a better deal.
If you decide to switch to a more competitive deal before your fixed term has finished, you may be liable for an early repayment charge and an exit fee. It’s important to check the fees payable and compare them with the savings you stand to make with a remortgage.
It’s also likely that your property’s value has increased since you purchased it. This may have pushed you into a lower loan-to-value (LTV) bracket. If that’s the case, you can benefit from lower rates. For example, you may have bought a flat in Pimlico using an 85% LTV mortgage. Now, however, its increased value may have reduced the LTV to 80%. This means you can benefit from the lower rates offered at that band when you remortgage.
Remortgaging has the potential to save you a significant amount of money each month. This also means you will reduce the amount of money you pay overall during the mortgage term. When dealing with high-value remortgages, time is often of the essence. The quicker the remortgage deal can be completed, the more you can save.
Have more flexible terms
As a high net worth individual, your income stream may vary and it’s more beneficial to have flexible terms for your mortgage. For example, you may receive regular bonuses that you can use to make overpayments on your mortgage, reducing the overall amount owed. Your existing mortgage may not allow for overpayments or may limit what you can overpay. By remortgaging to a more flexible deal, you can make overpayments without paying early repayment charges. Not only does this reduce the size of your loan but you may benefit from a lower rate as well.
Borrow more
Your property has hopefully increased in value since you bought it. Your original mortgage loan will also have reduced with your monthly repayments. Both of these increase the equity you have in your property. Rather than keeping this equity tied up in your property, you can release it with a remortgage and use it for another purpose.
For example, you may wish to buy another property as a holiday home or to increase your buy-to-let portfolio. Alternatively, you may wish to make home improvements on your Pimlico property instead of moving to a new home. This will increase the value of your property and be more cost-effective than paying the current high property prices for somewhere else to live. As its value will increase after the renovation works, you can benefit from remortgaging again in the future.
There may be other assets you wish to acquire other than property or you may want to use the extra capital to expand your business. Another scenario is that you may have accrued some debt and want to use the equity to clear it.
Flexible remortgage solutions
When looking to remortgage your high-value property, you need a flexible solution that’s tailored to your circumstances. High street lenders offer competitive deals but can be stricter in their criteria. If you have a complicated remortgage case, it’s beneficial to seek help from your mortgage broker in London, Kent or Edinburgh.
Independent brokers have access to remortgage products offered by specialist lenders and private banks. They are much more flexible in their lending approach. They can leverage your assets, consider various income sources, accept foreign currency incomes and offer higher income multipliers. These lenders can also offer remortgaging solutions if you are a foreign national or an expat.
For Pimlico mortgages and remortgages, your specialist broker is key to securing the best deal for your unique circumstances. Your broker will know which lenders to approach for different scenarios and be adept at finalising remortgages in a timely manner to adhere to any time constraints you may have. Rather than dealing with your existing lender or a new one yourself, using the services of a broker can save you a considerable amount of time and money.
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