Can I re-mortgage during coronavirus?

In light of recent Government guidance restricting moving home while we fight the coronavirus pandemic, our Residential Conveyancing team has been facing questions regarding whether similar restrictions apply to other areas of property, such as re-mortgaging.  John Blake, Senior Conveyancing Executive, explains here that we are still open to help you with your re-mortgage if your current mortgage is expiring, and what’s involved in the process of re-mortgaging.

Why should I re-mortgage?

There are several reasons why you may be looking to re-mortgage, including:

• Your current mortgage offer is coming to an end
• You are looking for a better interest rates
• You are interested in switching product, for example, from an interest only to a repayment mortgage
• You are looking for a way to consolidate your debts, reduce your monthly payments or raise some extra funds.

“We tend to see people re-mortgage when their current mortgage offer is coming to an end,” explains John.  “Without doing so, the home owner would revert to their lender’s standard variable rate, which normally is significantly higher than the introductory rate.  With the new lower interest rates from the Bank of England however, dropping to an all time low of 0.1%, now would seem a sensible time to consider your current mortgage and look for alternatives in an attempt to reduce your monthly payments at a time when you may be facing other financial pressures.  While you should be wary of any early redemption fees that may be payable by leaving an existing fixed term, the benefits of moving may outweigh those fees in the long term.” 

Do I need a survey done when re-mortgaging?

There are several steps involved in re-mortgaging, with one of them being a valuation survey carried out by the lender.  Under the current restrictions, physical property surveys are not permitted, however there are options such as desktop valuation surveys, so if you are looking to re-mortgage, you should ask your mortgage broker, or lender if you are dealing directly with the lender, whether they can offer a desktop option. 

Can you complete the conveyancing for my re-mortgage during the coronavirus pandemic?

While we are not currently offering face to face appointments across our offices, our teams are working remotely and we are able to carry out the legalities of a re-mortgage online by using our online identification and Money Laundering services.  

What is the re-mortgaging process?

There are several steps involved in re-mortgaging:

1. Initial information – this stage is about fact collecting, asking you for details on your current mortgage(s) before we request the deeds and obtain an up to date Title Information Document from the Land Registry.  We will also ask your current lender for a preliminary redemption statement so we can calculate any outstanding payments that may be due to them.
2. Searches – if your lender requests them, we will then carry out the necessary searches with the Local Authority, drainage and environmental companies. 
3. Legal checks – this includes our review of the property’s legal title, planning permissions and building regulation approvals. 
4. The mortgage offer and mortgage deed – once we have receipt of the mortgage offer, we will discuss this with you before asking you to sign and return the mortgage deed to us.
5. Final completion checks and searches - once we hold the signed documentation, have carried out final searches with the Land Registry, requested a final redemption statement from your current lender(s) and have completed our checks, we can discuss with you a suitable completion date.  We will apply for the loan monies from your lender (Certificate of Title) to arrive the day before the completion date.
6. Completion day – it is on this day that we will pay off the existing mortgage(s) and send the balance of any monies to you.  We will also then register the new loan at the Land Registry.

John concludes, “As with any decision of this nature and size, there will be pros and cons to re-mortgaging, which will vary depending on your own personal situation and the reasons why you are looking to re-mortgage.  We would always advise you to speak with your mortgage broker, your lender, or with us if you have questions about the process of re-mortgaging or whether it is the right decision for you.”

To find out more about re-mortgaging and what is involved, you can contact John or a member of the team on 023 9277 6551 or email johnblake@warnergoodman.co.uk.

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.