As a homeowner who wants to reduce their monthly payments on the mortgage, remortgaging is a great option. When looking out for a remortgaging deal, consider the overall costs involved rather than opting for the headline rate. The total fees and rate play a role in determining how much you will pay for your deal.
Below are three of the costs that arise during every remortgage process:
Mortgage Booking Fees
Mortgage booking fees are placed to show your commitment to the property you choose, according to Conveyancing Supermarket, experts based in Cheshire. This is so that your mortgage solicitor can secure your interest in that particular mortgage. You should pay this booking fee before handing in your loan application. This fee is non-refundable. This is important to note in case you had planned to change your mind once you enter into that deal.
Remortgage Arrangement Fees
Your mortgage lender will need an arrangement fee to set up your mortgage. The arrangement fee can be a percentage of the amount you want to borrow or can be a fixed amount. A lower mortgage rate calls for a higher arrangement fee. You may pay the arrangement fees before taking your mortgage or add it to your mortgage.
It is, however, advisable you pay these upfront to evade the high-interest rates since the arrangement fees are subject to the mortgage interest rates.
Remortgage Legal Fees
Transferring a mortgage from one lender to another requires some legal work, and this is where you should pay the legal fees to your solicitor to handle the legal process for you. Remortgaging legal costs are less expensive than those you paid on your first mortgage.
It is important to note that these remortgaging fees vary depending on the lender. Some creditors offer free legal or valuation fees while others offer discounts on certain costs once you engage them in your remortgage process. Engage a solicitor in finding out whether your lender charges remortgaging fees, and how much that will cost you.