If you’re considering switching your mortgage, you may be wondering whether you’re eligible to do this and how the process works. To help you to navigate this, we have put together a guide on switching mortgages and how to ensure that you secure the best deal for your circumstances.
What does it mean to ‘switch my mortgage’?
Switching your mortgage means changing from one mortgage deal to another. This could be with your current mortgage provider or moving to a different provider depending on the reason you’re looking to switch. Switching to a different deal with your current mortgage provider is quicker than changing to an alternative one as they already know your eligibility and you won’t need to go through credit checks and valuations. You also won’t need a solicitor for this, but you would if you chose to switch mortgage provider. However, it may be that you can get a much better deal with another provider, so it’s certainly worth exploring your options.
You can switch your mortgage at any time, but this may be subject to fees depending on how long you’ve got left on your current term.
Reasons to switch your mortgage
There are a number of reasons why you might like to switch your mortgage. For example, it could be that your current mortgage is coming to the end of its term and you don’t want to go onto the standard variable rate (SVR). The standard variable rate is often higher than the fixed rates that mortgage companies will offer, so it’s usually preferable to have a new deal lined up before your current one ends. You have more certainty with a fixed rate mortgage as you’ll know exactly what you’ll be paying each month, but if you’d rather not be tied into a deal you mind find that a standard variable rate mortgage is better for you.
Another reason to switch your mortgage is that you’ve found a better deal which outweighs any exit fees you’ll have to pay to end your current mortgage before it’s completed its term. This won’t be an issue if you’re currently on the standard variable rate as you’ll be able to switch at any time without fees, but if you’re on a fixed term you may find that there’s a fee to pay. This is usually a percentage of the amount you have left to pay back and can change depending on how many years are left on your term. For example, you might pay 5% to exit during the first year of a 5-year deal but only 2% to exit in the fourth year. This will be down to your mortgage provider.
You may also want to switch your mortgage because there are certain elements of your deal that don’t suit you anymore. For example, if you come into some extra money and would like to make a large overpayment on your mortgage, it might be that you’re unable to do this on your current deal and will need to switch your mortgage in order to invest the additional money into your property.
Using a mortgage advisor to switch
As with most things, it can be difficult to find the best deals when searching for them by yourself, which is why a mortgage advisor can be invaluable when it comes to switching your mortgage. An advisor will be able to take everything that you’re looking for into account and can research the best deals to fit your requirements so you know exactly what’s on offer.
A mortgage advisor won’t only be able to help you to find the best deals, but they can help when it comes to working out which type of mortgage is best for you too, plus you’ll save lots of time that you would have otherwise spent researching! You may also find that your mortgage application will go through quicker when using a mortgage advisor due to the relationships that they have with many lenders.
If you’re looking to switch mortgage deals and would like some help with this, Choice Mortgage Solutions are here to assist you. Whether you want to find a lower interest rate or release equity from your property, we can guide you and ensure that you’re doing the right thing for your circumstances. Contact us today!