What does a solicitor do when re-mortgaging?
What does a solicitor do when re-mortgaging? A solicitor carrying out re-mortgage conveyancing will perform searches on your property to ascertain what rights or liabilities you have. The solicitor may also act for your lender, ensuring that the property warrants the level of borrowing you have applied for.
Do you have to pay solicitors fees when re-mortgaging?
There are a host of fees you may be liable to pay when in the process of re-mortgaging your property. This will include legal fees that will be owed to the solicitor you have appointed to carry out this job.
These fees are essential in order for the solicitor to carry out the necessary legal work that enables the transfer of the mortgage on the property from the current lender, to the new lender.
Additionally, it is likely that there will be an outstanding amount owed to the original lender on the mortgage, the solicitor will ensure that this debt can be paid, avoiding a potential legal battle. It is clear that re-mortgaging a property is a lot quicker than applying for a first mortgage on a property.
As a result, the legal fees will be substantially less but nevertheless, fees are still required in order for the solicitor to do their job efficiently.
Do you need to instruct a solicitor when re-mortgaging?
It is not always necessary to appoint a solicitor during the re-mortgage process.
For example, if you are borrowing more on top of your existing mortgage or if you re-mortgage with your current lender (what is called a product transfer) to obtain a new rate or an improved deal, then there will be no legal work involved. Any fees are likely to be associated with the mortgage lender.
There are situations when instructing a solicitor is necessary.
- You may wish to add someone to the mortgage, whether that be your partner, business partner, or a friend. A solicitor will be required in such a situation because you are altering who the property is owned by. A solicitor will therefore amend the deeds and help determine how the property is to be held going forward.
- The opposite of one above, you may wish to remove someone from the mortgage, a solicitor will be required and will follow the steps above.
- Last but not least, if you re-mortgage with a new lender, a solicitor should be appointed to ensure the smooth transition from the original lender to the new lender. The solicitor will ensure the deeds change hands and that all necessary documents are signed.
This is a non-exhaustive list, there are several situations when a solicitor is required during the re-mortgage process
How long does it take to re-mortgage?
It typically takes between 4 to 8 weeks to re-mortgage your property.
However, if you are re-mortgaging with the current lender, otherwise known as a product transfer, this can be a speedy process since it usually only involves changing the current deal.
Choosing to re-mortgage elsewhere is likely to be more costly and take a longer period of time.
This is not necessarily a negative, after all, it is likely that you will be receiving a better deal by moving to a new lender, but ultimately the process will be treated as though it is a new mortgage.
Therefore, the new lender will require assurances about your financial situation, as well as your identity and the property itself, hence why it can take some time to process.
How does re-mortgaging work?
There are four steps in the re-mortgage process.
First, it is essential to agree with the lender or a mortgage broker on the amount required, otherwise known as securing an Agreement in Principle (AIP). This provides no guarantee but does give an idea as to the options at your disposal.
Following this, it is advisable that you consider all potential costs, for example, legal and valuation fees. Be sure you are aware of an exit fee or early repayment fee that may be required. You need to be sure that you are to be in a better position by re-mortgaging the property.
Only after considering these previous steps should you consider applying for the re-mortgage. Do this by providing the correct personal and financial details, accompanied by relevant documentation.
Then you are in a position to complete the re-mortgage process, which is similar to the process for applying for a first mortgage.
Should I go with my lender’s offer of Free legals?
“Free” legals are a great idea in theory but often misleading and not effective in practice – for clients and brokers. Additional costs can be suffered due to the service delivered via “free” legals.
Mortgage solutions reported “Brokers say the term ‘free-legals’ is a misnomer because the process takes so long it costs their client money when their mortgage deal expires and then ends up on a more expensive standard variable rate (SVR) until the remortgage completes. It also costs them more in manpower than if the conveyancing work had been paid for.” (Read the article here)
You can avoid the risks attached with “free” legals via a cashback alternative.
Many lenders will offer cash back as an alternative and you can use this cashback to cover the costs of legal fees meaning:
- You are not paying for the legals (subject to the quote being equal to or lower than the cashback amount – which with a number of our solicitors it IS!)
- You receive a faster and more efficient service from leading solicitors rather than the free legal choice of the lender.
- You may be able to spend the balance on the cashback received and the sum spent on re-mortgage solicitors to enjoy yourself!
We partner with specialist solicitors on our cherry-picked panel to ensure an industry-leading service is provided. With the additional rewards and savings via FREE Online Discount Club & My Legal Club membership when you choose us, we provide a fantastic alternative for clients to consider.
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