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UK MORTGAGE CENTRE

How to remortgage to release equity

June 12, 2024

how to remortgage to release equity

Considering making some sought-after home improvements? Or maybe you’ve decided to finally book that trip of a lifetime?

Whatever your reason for wanting to remortgage and release equity from your property, understanding how this process works can be crucial to helping you get the most out of your home.

Fortunately, the trusted remortgage advisors at UKMC have years of invaluable experience helping homeowners to switch to new and cost-effective remortgage deals without even changing lenders.

Below, we answer some of the most frequently-asked questions on this topic including how to remortgage to release equity, how easy it is, how long it takes, and how much equity you can actually release.

How easy is it to remortgage and release equity?

It’s relatively easy to remortgage and release equity from your home with the right mortgage guidance. Depending on which deal you choose, you can either remain with your existing lender or switch to a new one.

Sticking with your current lender will often make the process of remortgaging and releasing equity that bit easier, but with the right support, changing to a new lender and deal needn’t be difficult either.

How much equity can I release by remortgaging?

When it comes to releasing equity from your home, it’s important to bear in mind that you’re borrowing money based on the value of your home. Generally, this means the more value that’s built up on your home, the more equity you’ll be able to access.

Most mortgage lenders will have a maximum loan to value (LTV) that they are willing to lend. While this figure can vary, lenders tend to offer between 20% and 60% of the value of your home for this type of deal.

However, it’s worth noting that the exact amount a lender is willing to offer you will naturally vary depending on the lender, as well as your age, the value of your property, and a variety of other factors.

To get a more accurate idea of how much equity you could release by remortgaging, we recommend discussing your specific requirements with an experienced mortgage advisor, like UKMC.

Our trusted mortgage advisors can review your options on your behalf and bring you the most suitable deals to explore. Why not contact our expert team today to find out more about how we can help?

How does releasing equity affect mortgage repayments?

There are two ways that homeowners tend to release equity from their property when remortgaging – they either release equity using a standard remortgage or a lifetime mortgage.

With a standard remortgage and equity release, your monthly mortgage repayments will increase as you’re borrowing more money. Typically, the higher your LTV, the higher your interest rate will be.

It’s therefore crucial that you don’t borrow more equity than you need if you want to keep your monthly mortgage repayments as manageable as possible.

A lifetime mortgage, on the other hand, won’t increase your monthly mortgage repayments as this type of equity release loan is only repaid when the borrower passes away or enters long-term care.

However, the interest on a lifetime mortgage will increase due to compound interest, leading to a larger debt. Often, you must also be aged 55 or over to be eligible for this type of equity release.

How to remortgage to release equity

For homeowners that are new to this process wondering ‘how do I remortgage to release equity’, it often helps to have a step-by-step guide.

Fortunately, our friendly team can help!

Below, we explain the right way to approach remortgaging to release equity in just a few straightforward steps.

Contact a remortgage advisor

With so many lenders and deals to explore, reaching out to a remortgage advisor can help to simplify your options and even give you access to exclusive deals.

An experienced remortgage advisor can also explain complex terms and help you to determine whether a product transfer deal or switching to a new lender would be most appropriate for your specific circumstances.

Decide on a deal

Once you have all your options in front of you, you’ll need to make a decision. When choosing the right deal for you, there will be many factors to consider alongside the more obvious ones, such as the lender and interest rate.

This includes product fees, early repayment charges (ERCs), exit fees, and valuation fees. By seeking expert advice to fully understand each option, you can form a clearer idea of which deal might be the most suitable for your requirements.

Don’t wait until the last minute

Unlike a relatively straightforward product transfer, the process of releasing equity from your home means this application process can take anywhere between four weeks to a couple of months to complete.

As a result, remortgaging to release equity shouldn’t be left until the last minute. Generally, we recommend contacting a remortgage advisor, like UKMC, six months before your existing mortgage deal is due to end.

Remortgage with UKMC today

At UKMC, our expert advisors understand that mortgage jargon, ever-changing interest rates, and endless lenders can be confusing at best, leading to bewildered homeowners that would rather stick to their existing deal.

Unfortunately, this means you could be missing out on fantastic new deals that make your current interest rate look less than appealing.

However, with a little support from the down-to-earth remortgage advisors at UKMC, we can help you to find the most suitable option for you, saving you hundreds without the hassle of even switching lenders.

Instead of remortgaging feeling like an ordeal, we’re dedicated to ensuring you have a seamless experience by guiding you through all the complexities, explaining new terms, and adopting a tailored approach.

Is your existing mortgage deal coming to an end withing the next six months? Reach out to our helpful team today to review your options or learn more about how to remortgage to release equity.

To get in touch, you can either give us a call on 01925 573328, request a call back using our online contact form, or send your enquiry via email to hello@ukmc.co.uk.

Alternatively, if you prefer a more personal touch, why not schedule a face-to-face appointment? Our friendly team are always happy to help!

Disclaimer

UK Mortgage Centre is a trading style of Refresh Mortgage Network Limited. Refresh Mortgage Network Limited is authorised and regulated by the Financial Conduct Authority. FRN – 826982. Registered in England & Wales: 11614569. As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments. The Financial Conduct Authority does not regulate some forms of buy-to-let mortgages. The Financial Conduct Authority does not regulate will writing and taxation and trust advice.