What Are The Criteria For Remortgaging?
Much like securing any other mortgage, there are numerous factors that lenders will take into account when evaluating your eligibility if you’re remortgaging your home.
Much like when you first applied for your mortgage, you’ll need to ensure that your credit score is healthy if you want access to the best deals. That’s not to say you can’t remortgage if you have a bad credit score, but it may not be as worthwhile as many of the better deals will be off limits.
When remortgaging, other factors that come into play include:
Loan to value ratio: This is calculated by dividing the amount of money you wish to borrow by the current value of your home, the resulting percentage figure being your loan to value ratio. Generally, lenders don’t want this ratio to exceed 80%, but that’s not always the case.
Your debt to income ratio: How much you owe and how much you earn are key for remortgage lenders; the lower your debts in relation to your income, the better your chance of securing a better deal when you remortgage.
Lenders will be taking into account all of the above factors when offering you remortgage deals, so it may be worth holding off remortgaging temporarily if you have outstanding debts; in the long run, the better deal you’ll likely access without these debts could save you a lot of money.
If you’re looking to remortgage and want honest and easy-to-understand advice, speak to us at Derngate Wealth Management today. We can guide you through the process from start to finish, and we can obtain mortgages representative of the whole market, allowing us to find a deal which suits you.