With many people either furloughed from their jobs or working from home with time to think about the future, one of the main areas that is being contemplated is re-mortgaging. According to What Mortgage Magazine, online searches using the term ‘re-mortgage’ have risen by 60% in the second half of March as more customers search for ways to reduce the cost of their home loan. The reduction in base rates to record low levels has also prompted borrowers to look at what other deals may be available. With house moves largely paused mortgage lenders are focusing on those looking to re-mortgage their existing property.
We have looked at the benefits of re-mortgaging in previous blogs and the general principal that you should review your mortgage regularly still apply. However, with physical valuations all but impossible at present the proportion of the property value that mortgage providers will lend is restricted compared to normal circumstances. The “desktop valuations” that are currently possible are available from some lenders and we will be able to advise on your best course of action here. Even if you have a payment holiday in place with your current lender you should still be in a position to investigate re-mortgaging. What you will need to bear in mind in addition to the usual requirements of a re-mortgage is that the affordability of a loan will be assessed to take into account changes in your income while you are ‘furloughed’ from your employment.
The main reason for re-mortgaging is still to avoid your loan reverting to the Standard Variable Rate (SVR), which can prove expensive. Many lenders are still advertising attractive fixed rate mortgages. If your current deal ends within the next 4 to 6 months, it would be worth starting to look at what options may be available to you. As all our circumstances are likely to change over the next few months, the criteria that lenders use to assess mortgage applications will shift as well.
If you are considering re-mortgaging we are available to discuss your personal situation by phone or now by Skype. The details can be found on our contact page.