Why is Now the Time to Remortgage Your Home?
 |
| Why is Now the Time to Remortgage Your Home? |
With property values skyrocketing and the remortgaging business thriving, there has never been a better time to refinance your house. If you've been thinking about making home upgrades, remortgaging to release equity may be a terrific strategy to keep costs down while also making the most of your hard-earned property.
The remortgage market is 'overwhelmingly robust'
LMS's most recent 'health check' of the remortgage market revealed that it is in excellent form this quarter, with growth indications for all factors indicating prosperity.
Approval rates, financing prices, home equity, and consumer attitude are among the factors evaluated. Borrowing costs, in particular, were found to be highly healthy, putting borrowers in a stronger financial situation than they had been since 2017.
Furthermore, as lenders compete for business, the cost of two- and five-year fixed rates has fallen over the last two quarters.
Homeowner equity rates have also hit an all-time high, thanks in part to the stamp duty break and boosted by high property prices and restricted supply.
Remortgage your property to unlock equity
With house prices skyrocketing, it's probable that you've accumulated equity since buying your property. Releasing equity from your house may help you afford home upgrades such as a new kitchen or bathroom, as well as loft conversions and expansions. Remortgaging avoids placing a major cost on a credit card or taking out a new loan, and mortgage interest rates are often lower than those on personal loans or credit cards.
To calculate equity, reduce the percentage of your mortgage paid off from the value of your home. Local real estate brokers often provide free property appraisals to help you determine the value of your house.
How much equity should you release?
If you have a considerable amount of equity in your property, you should consider releasing money for home upgrades. Typically, lenders save their best rates for borrowers with lower loan-to-value ratios of 60-65 percent.
If you are considering releasing equity from your home, you should consult with an independent mortgage counselor who can assist you in determining how much cash you may release without significantly affecting the loan-to-value ratio.