freelancerfinancials.uk.com/prime-time-contractors-remortgage-svr/
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Maybe remortgaging takes second place to running their business? Thats understandable, too. Dabbling in their
accounts, marketing and pitching their business, actually carrying out their contract. It all takes time.
Juggling so many balls, they never get chance to see if theyd be better off remortgaging.
Maybe theres an even simpler reason contractors dont look for better mortgage deals. They dont know they can.
But nothing could be further from the truth; contractor-friendly mortgage lenders want their business.
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The more you pay off the balance, the less the lender has to charge interest upon.
Moreover, this has a compound effect year on year. Yes, you might only be paying off an unobligated 2,060 a year,
but the effect of the term is considerable.
You can knock years off your mortgage term by overpaying in this way.
Or you can use a new lower interest rate to free up more cash each month for other investment opportunities, like
buy-to-let or ISAs.
How the low BoE base rate can affect your repayment
The low base rate on offer from the Bank of England to the UKs mortgage lenders extends the opportunity.
Today, lenders can make the rates they offer on new mortgages lower than ever. Its so tempting that you should at
least consider remortgaging your existing property.
But Ill just touch on the could be I mentioned above. If youre on a life-time tracker mortgage, you may already be
repaying at a fantastic rate.
Another stinger that could derail you is legal fees. There is an official paper trail to follow when remortgaging. You
must remove your current lenders interest in your property and register the new one.
But again, for those apathetic about switching, legalities are little more than an excuse. Most of the remortgages we
offer include a free legal package. If thats your argument for not switching, its moot.
But, yes: you should always weigh up the pros and cons of switching your mortgage deal. And thats why were here.
One call and we can tell you whether we can improve on your existing interest rate.
Well also let you know how much it will cost you to wrap up your existing mortgage, including fees. Well never
recommend that you remortgage if youre going to be out of pocket.
And, yes; it may well be that youre on a great tracker rate with your current lender. Thats awesome. Again,
remortgaging may not be the right thing for you if thats so.
But if not, youre in a minority whove taken advantage of lenders special offers. As Legal & Generals figures imply,
theres a huge percentage of the UK yet to do so.
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equity.
In truth, thats not the typical profile of a contractor.
But mortgage prisoners who do fit the contractor profile are those with interest-only mortgages.
Getting the mortgage in the first place was simple enough. But with no clear, credible repayment strategy in place,
theyre trapped. But theres brighter news on the horizon.
Several lenders have recently relaxed their criteria towards interest only mortgages. Leeds Building Society is a
prime example of a contractor-friendly lender to do so.
Heres how it works in this instance.
A contractor can use the sale of the mortgaged property as their repayment strategy. For it to qualify, they must have
at least 50% equity in their home today. Then at the end of the term, they must show a clear 150,000 equity in the
property.
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We can use your contract rate to make remortgaging to better rate a real possibility. Two things make this work:
relationships weve built with contractor-compliant underwriters gives us a direct line to them;
the way we package your application, highlighting your greatest asset: your contract rate.
All too often, in branch advisors can see how much you earn. But your accounts show optimised tax breaks,
meaning you draw low salary and dividends. Its this reduced figure in-branch staff use as the base of your
affordability.
These in branch IFAs can see your potential. But the lending model they use means they cant get at it.
The underwriters with whom weve negotiated terms see your true potential.
They use your contract rate and retained profits to calculate your affordability. You wont get this access at the vast
majority of High Street lenders!
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