| When interest rates fall, there are savings to be | | | | who can benefit from re-mortgaging. This is |
| made. This is true for everyone, not just people | | | | because even though their current mortgage will |
| currently looking for a new home or mortgage. | | | | have reduced its interest rates in line with a lower |
| This means that even if you have already bought | | | | Bank of England rate, there may be significantly |
| your home or already committed to a mortgage, | | | | cheaper mortgages on the market that they wish |
| you can take real advantage of lower interest | | | | to switch to. |
| rates. | | | | Redemption Costs |
| For many people this will not be necessary, as | | | | Just like many loans on the market if you wish to |
| they will have a variable rate mortgage that goes | | | | pay your mortgage off early then you may be |
| down as interest rates fall and so you get to | | | | liable to pay an early redemption penalty. Normally |
| take advantage of lower interest rates as they | | | | for a personal loan in the UK the average |
| come. However there are many situations in | | | | payment or charge is between one or two |
| which re-mortgaging will be beneficial. | | | | months interest payments. This charge should be |
| Step One | | | | taken into consideration when contemplating |
| The first is for people who are tied into fixed rate | | | | transferring your mortage away from your |
| mortgages at higher rates. Since their mortgage | | | | current provider. |
| rate is fixed, they will not be getting any of the | | | | Your In Credit |
| advantages of lower interest rates. This is an | | | | Often, people re-mortgage because they find that |
| unenviable position and one of the best ways to | | | | their credit rating has improved dramatically since |
| get out of it is to re-mortgage on better terms. | | | | they took out their first mortgage. If you took |
| You will have to check if this is worthwhile | | | | out a mortgage five years ago, then it could well |
| however. If your existing mortgage has | | | | be the case that your income has increased, the |
| redemption penalties or an extended tie in, then | | | | value of your home has increased, and you may |
| getting out of the mortgage is likely to cost you | | | | also have some savings now. All of these factors |
| a lot of money. You will also have to consider the | | | | will allow you to apply for more exclusive |
| arrangement or refinancing fees and add this to | | | | mortgages that offer better rates. If this is the |
| the cost of making the change. Only if, after | | | | case for you, then looking into a re-mortgage |
| calculating all of these extra charges, the lower | | | | that takes advantage of all these benefits is a |
| rates are worth the expense of re-mortgaging, | | | | very good idea. Don't be afraid to take the best |
| should you go through with the transaction. | | | | offers available to you on the mortgage market. |
| There are also people on variable rate mortgages | | | | |