Remortgaging Your Home: What it Means and When to Do it

If you’re like most Americans, your mortgage is your biggest financial commitment. If you are stuck in a bad agreement, you could be overpaying by thousands of dollars each year. Luckily, homeowners may have the option to remortgage their home in order to secure a better deal.

In this article, the financial advisors at American Investment Planners, LLC discuss the purpose of remortgaging, when you should consider it, and what steps you need to take to finish the process…

What is remortgaging?

Remortgaging your home is simply the process of switching your mortgage deal – either with your current lender or a new one. There are four main reasons to do this:

• Reduce your interest rate
• Free up some of your property’s value for other spending
• Reduce monthly payments by extending the term
• Reduce the mortgage term

When you should (and shouldn’t) consider remortgaging

In some cases, remortgaging your home could save you thousands of dollars. In other cases, you may lose money by making the switch. Here are some factors to consider when making the decision…

You should remortgage if:

• Your current deal is about to end
• You have a high interest rate
• Your home’s value has significantly increased
• You are worried about rates going up
• You want more flexibility

You should NOT remortgage if:

• Your remaining mortgage debt is small
• Your home’s value has dropped
• You have little equity
• You already have a great interest rate
• You have credit problems

Still don’t know if remortgaging is the right choice? This interactive online calculator can quickly estimate the potential savings (or losses) of making the switch.

How to remortgage your home

If you want to remortgage your home, or are at least seriously considering the idea, here is what you will need to do:

1. Think about why you want to remortgage.
2. Get your paperwork together.
1. Calculate your current costs.
2. Research your current loan’s restrictions and fees.
3. Shop around for a new mortgage.
1. Calculate potential switching fees.
4. Speak with an independent financial advisor at American Investment Planners, LLC to see if remortgaging makes sense.
5. Ask your current lender to match your new deal or offer a better one.
6. If they decline, apply for the new deal.

American Investment Planners, LLC has helped families across the country manage their mortgages for decades. If you are considering remortgaging your home, let us help. Our consultants can answer any questions you may have, and formulate a plan to meet your needs.

To schedule an appointment with one of our advisors, please call (516) 932-5130, or email info@americaninvestmentplanners.com.