UK Remortgage: a Complete Step by Step Guide. By Uthman Endurance Oduselu

UthmanOdus By UthmanOdus, 4th Oct 2012 | Follow this author | RSS Feed
Posted in Wikinut>Money>Mortgages

This article gives a brief view of Remortgaging in relations to the United Kingdom. It serves as a complete guide to a layman who has no prior knowledge on the matter. For instanceit gives a summary of all the relevant steps to take in order to have an effective remortgaging experience.


The three basic necessities of life are no doubt, food, clothing and shelter. The uniqueness of the trio cannot be over emphasized. This paper however focuses on shelter. The history shelter to man is as old as man himself - dating back to the Early Man - who resorted to the Cave as his place of refuge after embarking on a game. Over time however, the sheltering of man has underwent various transformation, both in name and the kind of comfort occasioned by the price tag associated with it. In a bid to making such homes affordable for fellow human beings therefore, some private individuals and organizations have fashioned out different options of houses for man to acquire, both in the realm of comfort and convenient modes of payment given the scarce resources. This therefore birthed Housing Loans, Mortgage, Remortgage etc.
At least, the evolution of mortgage system dates back to the 12th century which many have attribute to the feudal system, was ”derived from the French words, 'dead pledge’ " says Giles (2007).
In his work titled 'UK Mortgage History' Giles (2007) posits that dead pledge type of mortgage "has not been available in the UK since the Land Registration Act 2002. Far more usual is the mortgage by legal charge, which has been in common use since 1925". What then is 'remortgage'?

Conceptual Appraisal of relevant Variables

Opinion is divided on the words that best describe the term, 'remortgage'. For instance, while Wikipedia sees it as "...the process of paying off one mortgage with the proceeds from a new mortgage using the same property as security"; Clerical Medical (2005) opines that remortgage is simply the "Replacing (of) an existing mortgage loan with another one". Perhaps, the most simplified meaning of the said concept is when Mussi (2012) asserts that remortgage is "...switching your mortgage to another lender that is offering a better deal than your current lender thereby saving money". From these definitions, one fundamental affinity (in all these conceptual appraisals above) identified is the need to save cost or getting better deals. According to Wikipedia, remortgage is a concept that predominates in the Anglo-Saxon countries such as the UK and the United States.
The term 'UK' on the other hand, is the abbreviation of United Kingdom, which refers to all the Islands territory of the sovereign state of the United Kingdom of Great Britain.

Ideal Remortgage Offers in the UK

Mussi (2012) claims that remortgage good deal should offer their clients the following:
Lower & discounted interest rates;
Reduction of your monthly outgoings by up to 50%;
The chance to clear your existing mortgage, plus any arrears or other debts;
Consolidation of existing loans into one easier-to-manage monthly payment;
No restrictions on what you do with any extra cash raised etc.

The Gains of a Remortgage

The gains of remortgage include:
First, it allows clients access to better rate of interest and reduce monthly mortgage payments.
Second, it allows beneficiary to consolidate existing loans to one manageable monthly payment or raise money to buy a new car or home improvements.

Pitfalls of Remortgage

The pitfalls of remortgage include:
Maximum available amount is only £ 25000.
Interest rates are still very significant without much difference.
Extra charges for making early payment on current loan

Remortgaging Recommendations

In order to avoid pitfalls and consequently maximize the potential of the financial strategy as examined above, clients are advised to carry out the following:
Seek proper remortgaging advice from trustworthy professionals who are aware of the market to avoid pitfalls.
Learn which rates provide the greatest value in order to save the client a considerable sum of money.
Compare offers from different lenders and inquire about their policies about early repayment. The more flexibility you have with a loan, the more freedom you'll have to arrange favorable terms in the future.

Steps to Remortgage

On a general plain, the steps involved in for any client in engaging lenders in remortgaging are:
Complete an application
Check your fees
The mortgage offer
The legal work
Completion date set
Signing the mortgage deed
Report on title
Requesting the funds


On the whole therefore, it is clear that, for those who, in the short-run, intends to bear some burden for future gains with regards to shelter ownership, remortgaging is the best option to adopt and indeed, with proper professional guidance from those who know how the market operates, this strategy of financial planning - remortgaging – would the risk thereof would be highly reduced.

moderator Peter B. Giblett moderated this page.
If you have any complaints about this content, please let us know


Add a comment
Can't login?