Remortgage - What Is It And Why You Should Do It
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James Copper
Apr 26, 2013, 5:30:03 PM4/26/13
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Article Title: Remortgage - What Is It And Why You Should Do It
Author: James Copper
Word Count: 552
Article URL: http://www.isnare.com/?aid=141614&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=141614
Easy Publish Tool: http://www.isnare.com/html.php?aid=141614
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Remortgage can be defined in two different ways. The first is when a homeowner takes out a loan, using their property or the equity in their property as collateral, when they already have a loan on the property. The second definition is when a homeowner changes their current loan to a new lender.
Remortgaging by taking a loan out on existing property is usually referred to as a home equity loan. Since the homeowner really does not own their home, since they are still paying to the bank, they can not actually use the home as collateral.
However, homes and property go up in value over time, so the home is building equity. Equity is when the home and property is worth more than the amount of the original loan. For example, a person buys a home for $100,000 but it appraises at 150,000. This person would then have $50,000 in home equity or money that belongs to them which they do not owe the bank. They can then remortgage and get a loan for the amount of their equity.
Changing lenders is actually common. It may seem like a strange tactic, but it is very beneficial. Some people start out with a loan that may have high interest or fees because they could not get a better loan. After a couple of years their credit is better and they want to see about lower their fees and interest. This is a good time to remortgage.
Usually a remortgage is not done until after two years with the current lender. This is because most contracts include penalties for early termination of the loan, including paying it off. This is to protect the lenders interests.
The lender is in the business of making money and they do not make as much as they would like when a person ends their loan early. Usually, though, after two or three years the penalties are waived and the homeowner is free to find a different lender.
Normally when you come to the end of your fixed rate period you will be moved onto the lenders standard variable rate, where the inertest rate will be higher and fluctuate. This is when it is a good time to remortgage, switch lenders and start afresh on another fixed rate mortgage product.
Remortgaging can save a homeowner a lot of money. Especially if the original loan carried high interest due to bad credit. By remortgaging a person can find a loan with lower interest. That means lower monthly payments now and less money paid in the long run. It is a great option for the homeowner.
Some homeowners take advantage of remortgaging. They stay with one lender for a certain time until they find a better deal. By remortgaging a person can take full advantage of the opportunity to save a lot of money on their home purchase.
It is not hard to remortgage, which makes it an even better opportunity. All a person has to do is stay current on the lending trends and interest rates. They should keep their credit in good standing as well. When the time is right they can then begin to shop around and apply for better mortgage deals.
About The Author: James Copper has been in the financial services industry for many years. He is currently a Fixed Rate Remortgage Expert for Remortgage-Here. http://www.remortgage-here.co.uk - On his days off James likes to write on all things mortgage and real estate related.
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=141614
*********************** ARTICLE END ***********************
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- For more free-reprint articles go to http://www.isnare.com
Message delivered directly to members of the group:
publish-the...@googlegroups.com
*****************************************************************
Please consider this free-reprint article written by:
James Copper
*****************************
IMPORTANT - Publication/Reprint Terms
- You have permission to publish this article electronically in free-only publications such as a website or an ezine as long as the bylines are included.
- You are not allowed to use this article for commercial purposes. The article should only be reprinted in a publicly accessible website and not in a members-only commercial site.
- You are not allowed to post/reprint this article in any sites/publications that contains or supports hate, violence, porn and warez or any indecent and illegal sites/publications.
- You are not allowed to use this article in UCE (Unsolicited Commercial Email) or SPAM. This article MUST be distributed in an opt-in email list only.
- If you distribute this article in an ezine or newsletter, we ask that you send a copy of the newsletter or ezine that contains the article to http://www.isnare.com/eta.php?aid=141614
- If you post this article in a website/forum/blog, ALL links MUST be set to hyperlinks and we ask that you send a copy of the URL where the article is posted to http://www.isnare.com/eta.php?aid=141614
- We request that you ask permission from the author if you want to publish this article in print.
The role of iSnare.com is only to distribute this article as part of its Article Distribution feature ( http://www.isnare.com/distribution.php ). iSnare.com does NOT own this article, please respect the author's copyright and this publication/reprint terms. If you do not agree to any of these terms, please do not reprint or publish this article.
*****************************
Article Title: Remortgage - What Is It And Why You Should Do It
Author: James Copper
Word Count: 552
Article URL: http://www.isnare.com/?aid=141614&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=141614
Easy Publish Tool: http://www.isnare.com/html.php?aid=141614
*********************** ARTICLE START ***********************
Remortgage can be defined in two different ways. The first is when a homeowner takes out a loan, using their property or the equity in their property as collateral, when they already have a loan on the property. The second definition is when a homeowner changes their current loan to a new lender.
Remortgaging by taking a loan out on existing property is usually referred to as a home equity loan. Since the homeowner really does not own their home, since they are still paying to the bank, they can not actually use the home as collateral.
However, homes and property go up in value over time, so the home is building equity. Equity is when the home and property is worth more than the amount of the original loan. For example, a person buys a home for $100,000 but it appraises at 150,000. This person would then have $50,000 in home equity or money that belongs to them which they do not owe the bank. They can then remortgage and get a loan for the amount of their equity.
Changing lenders is actually common. It may seem like a strange tactic, but it is very beneficial. Some people start out with a loan that may have high interest or fees because they could not get a better loan. After a couple of years their credit is better and they want to see about lower their fees and interest. This is a good time to remortgage.
Usually a remortgage is not done until after two years with the current lender. This is because most contracts include penalties for early termination of the loan, including paying it off. This is to protect the lenders interests.
The lender is in the business of making money and they do not make as much as they would like when a person ends their loan early. Usually, though, after two or three years the penalties are waived and the homeowner is free to find a different lender.
Normally when you come to the end of your fixed rate period you will be moved onto the lenders standard variable rate, where the inertest rate will be higher and fluctuate. This is when it is a good time to remortgage, switch lenders and start afresh on another fixed rate mortgage product.
Remortgaging can save a homeowner a lot of money. Especially if the original loan carried high interest due to bad credit. By remortgaging a person can find a loan with lower interest. That means lower monthly payments now and less money paid in the long run. It is a great option for the homeowner.
Some homeowners take advantage of remortgaging. They stay with one lender for a certain time until they find a better deal. By remortgaging a person can take full advantage of the opportunity to save a lot of money on their home purchase.
It is not hard to remortgage, which makes it an even better opportunity. All a person has to do is stay current on the lending trends and interest rates. They should keep their credit in good standing as well. When the time is right they can then begin to shop around and apply for better mortgage deals.
About The Author: James Copper has been in the financial services industry for many years. He is currently a Fixed Rate Remortgage Expert for Remortgage-Here. http://www.remortgage-here.co.uk - On his days off James likes to write on all things mortgage and real estate related.
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=141614
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
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