Not so surprisingly, it won't want to lend you money to start a new business…. The most commonly acceptable reasons to raise money are for home improvements and paying off other debts.
Mortgage Guide
Just be prepared for your lender to ask for evidence if you are borrowing a large amount, e. I always shiver slightly when people talk about adding non-housing debts to their mortgage, whether it's for a new kitchen, a holiday or to consolidate existing borrowing. There are times when this could be a necessary evil, perhaps to get you out of a hole. My problem isn't that it is wrong per se, in fact often it's a good move, but the issue is many people see it as a no-brainer solution. Let me make something plain.
Put that way, it suddenly doesn't seem so much of a no-brainer now does it? Maybe you want to be able to miss a payment. Changing jobs, going back into education, going travelling — whatever the reason, there are mortgages which will let you take payment holidays. Or maybe you've been tempted by different, whizzy mortgages which combine your savings or current accounts with your mortgage.
Whatever flexibility you want in a mortgage, chances are it's out there. But remember products don't offer these twiddly bits for free. Expect to pay for flexible features with a slightly higher interest rate. So don't be tempted to go for bells and whistles unless you will actually use them. If it sounds like remortgaging could be the right move for you, you want to start the search 14 weeks before you want to remortgage. Do have a look but you'll probably want to look at rates with a small fee, or no fee at all. The smaller your mortgage, the worse the effect of any fees you need to pay.
Quite often, you'll be better remaining on the higher interest rate. A large early repayment charge could mean that it'd be utter foolishness to move before the end of the incentive period. If it would cost too much to free yourself from your current deal, then it's all the more important that you do your homework, and be ready to move as soon as you can. It's always worth asking your current lender to let you switch to another of its deals ie, do a product transfer by paying a reduced early repayment charge.
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You're unlikely to get to move to its top-of-the range deal but as long as it's better than the one you're currently on, and doesn't lock you in for much longer, you have nothing to lose. It's possible that your financial position has altered since you took out your current mortgage - for instance, one of you has stopped working or you have become self-employed. New lenders may not be prepared to offer you a loan because you no longer fit their criteria, meaning you may have to stay where you are.
But now, your house price has dropped and the amount you owe is a bigger proportion. Unfortunately, you're a victim of evaporating equity, even if you have been making repayments, and that can hurt you. In some cases, you may be in negative equity, where your debt is higher than the value of the property. The only thing you can do is sit tight, make overpayments whenever you can afford it as long as you won't be charged fees as well, and wait for prices in your area to go up again.
Don't forget to check if your current lender charges an early repayment charge to leave. Since the credit crunch, lenders have become much more picky about who they lend to.
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The regulator, the Financial Conduct Authority, now also requires them to carefully check the mortgage is affordable, not just at current rates, but at a higher rate too, to ensure you could cope if interest rates were to rise. As a result, lenders will want a lot of detail about your outgoings, and are looking for spotless repayment histories or at least a good, clean record of handling debts well.
It might only take one recently missed payment to your credit card, loan, mortgage, utility company You may be already on such a fantastic deal that you'd be mad to move.
Help! We need to remortgage but are in negative equity
But don't get too comfortable — chances are it won't always be top of the tree so eventually you'll need to consider hopping onboard the remortgaging merry-go-round. Even if you think you've got the best deal, it's worth doing some checks so you KNOW you've got the best deal possible. Should you remortgage? If you go through it, it can sometimes result in a payment or benefit to the site. It's worth noting this means the third party used may be named on any credit agreements.
We aim to look at all available products. If it isn't possible to get an affiliate link for the top deal, it is still included in exactly the same way, just with a non-paying link. The registered office address of both MoneySupermarket. Deals Hunter Blog. We think it's important you understand the strengths and limitations of the site. We're a journalistic website and aim to provide the best MoneySaving guides, tips, tools and techniques, but can't guarantee to be perfect, so do note you use the information at your own risk and we can't accept liability if things go wrong. Its stance of putting consumers first is protected and enshrined in the legally-binding MSE Editorial Code.
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Remortgage: reasons you should (& shouldn't) - MSE
Top guides. Easy-access Savings The best rates where you can make withdrawals. If you start missing payments, it may disqualify you from some of the loan programs. Which refinancing program should you use? It depends on how you got your mortgage loan, or more specifically, it depends who currently owns your loan.
Borrowers may find that their loan is with Fannie Mae or Freddie Mac. In many cases these programs have no LTV requirement and don't require a new appraisal, so the loan's based on your home's previous value, which can make all the difference. You'll reduce the amount you owe by either making a large payment on your loan or by paying the cash at closing when you refinance. Unfortunately, this approach requires that you have access to a lump sum of cash.
The HARP program urges homeowners to apply again, even if they've been turned down before so it's worth taking that extra step. It does not allow any additional borrowing, however. For those who have a very small deposit there are other options. For those with just 5pc equity, Skipton Building Society offers a two-year fix at 5. How to deal with negative equity. HSBC offers a lifetime tracker at 4.
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