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If you have owned your current property for a number of years, the chances are that it has risen in value; therefore, the amount of loan you have against the property is probably lower compared to the value of the property. This means that you could potentially have a large amount of equity in the house that can be released if you choose to re-mortgage.
If you use the re-mortgage process to borrow extra money, the additional funds can be used to pay for a new kitchen, debt consolidation or even paying for a new car. Re-mortgaging has become a very straightforward process and one of the main reasons for re-mortgaging is to also reduce your monthly repayments. The re-mortgage process simply pays off your outstanding mortgage balance with your current lender. You will then borrow either the same amount or larger through your current lender or a new lender depending on who you have chosen as your re-mortgage provider.
Lenders now offer a variety of re-mortgage products and one type is the Tracker Re-Mortgage. This is a mortgage product that focuses on the interest rate available. It is predominantly marketed as a product that will follow any changes made to the Bank of England base rate. Lenders will offer you the facility to opt for an interest rate that is a set percentage above the base rate. This will be agreed prior to the completion of the mortgage. The agreed rate will be subject to change in accordance with any fluctuations of the base rate. This means that tracker rates can go up or down which will impact the amount of your monthly mortgage repayments.
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