Requirements to Qualify for a Remortgage

In order to remortgage your property, you must meet similar qualifications to those you met when you took your first loan. This essentially means you must have good credit, a good asset base, a steady income and low liabilities. However, since you have an existing loan on the home, your remortgage will also depend partly on the status of this loan.

Record of Past Mortgage Payments

It is rare to qualify for a remortgage on any first mortgage that is not in good standing. This means you will not qualify if you are delinquent, in default or approaching foreclosure on the property. In fact, in order to qualify for the best remortgage deal, you should have a perfect record of payments on your existing mortgage.

Incentive to Lender

A remortgage lender is competing to take your business away from the existing lender. There must be some incentive to this action, and that incentive is typically financial. The cost for a company to remortgage your loan is high, and the company is assuming liability in doing so. Therefore, you must be willing to turn over the asset, in this case your home, as collateral. You may also be required to put down an additional sum toward a second down payment or purchase new mortgage insurance.

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