Classic Real Estate

The process of transferring ones mortgage to a different lender is called a remortgage. Remortgaging happens for many reasons such as another lender offering a cheaper rate, the need for additional cash flow or because of debt consolidation.

The term remortgage is commonly used erroneously by homeowners when they are swapping their mortgage onto a different package supplied by the same lender. The mortgage itself is transferred to another provider.

The main reason for a change in mortgage provider is usually because the new lender is offering the same mortgage at a lower rate of interest meaning you will pay less for the mortgage in total. For example if you had a 100,000 mortgage changing to a lender whose rate was 1% cheaper could save you around 960 a year. If you are keen to save money this is one of the simplest ways to do so.

Unfortunately the current economic climate is not geared towards mortgage lenders, the credit crunch has meant that lenders are less likely to try to offer competitive rates, in all honesty they are not that keen to get new mortgage business. Do not let this deter you though due to the low base rates mortgages can be gained with a great decrease in interest, you will just need to hunt around.

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