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Is your buy-to-let or commercial mortgage fixed rate coming to the end of its fixed rate term?
What are the options? – It depends on the options each lender has available but the options are generally one of four which we have expanded on below.
Mortgage for a Buy-to-Let Refinance
If your buy-to-let mortgage is due for renewal, you have the following options to consider; speaking to an experienced property finance adviser will clear up any doubt.
1. Take no action – You will move to the lender’s reversion rate, which benefits from no early repayment charges. This could be the best option if you want to sell in the short to medium term.
However, the reversion interest rate can be higher and mean your payments increase. Unsure what the reversion rate is? Speak to one of our advisers who can help.
2. Product switch with your current lender – This means you enter a new fixed-rate product with the same lender. The benefit of this can be that you protect yourself against future interest rate increases.
Product switches with the same lender mean there are no fees from us and usually no valuation, legal, or application fees from the lender.
Overall, this option is a very cost and time-effective option; however, some lenders do not offer a product switch, speak to one of our advisers to find out more.
3. Refinance with a new lender – This can be attractive if you wish to raise funds. Similarly, if the current lender’s reversion rate or product switch rate is not competitive in the market, it can sometimes make financial sense to move to a new lender.
However, before we advise on this option, we will look at the overall cost/benefit analysis, so it makes financial sense for you to do this.
4. Refinance with the current lender – If you are looking to raise further funds, or if the lender’s new mortgage products could be cheaper now than when you took the original mortgage, (not all lenders offer this option, speak to one of our advisers to find out more).
How can Advocate Finance help?
We have experienced, friendly property finance advisers that are ready to answer your questions. We can provide a tailored mortgage illustration to meet your individual circumstances and the best part is that we have NO upfront fees and don’t charge a fee for product switches.
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