Remortgaging is when you change your mortgage to a different lender. Some people think that it means releasing some equity in your home, so making your mortgage higher so that you can have some money to spend on other things. While you might be able to do this, remortgaging just normally refers to changing your lender. It is something that quite a few people do and therefore you may wonder whether it is something that you should consider doing as well.
Advantages of Remortgaging
Cost – you may find that if you switch to a different mortgage you can save money. It is worth investigating this fully though. Most people will just compare the interest rate and assume that if they go to a mortgage provider with a lower interest rate it will mean that they will save money. This seems to make logical sense but you will need to bear a few things in mind. You need to consider the fact that there may be other fees as well. There could be admin fees when you take out the mortgage for example, and although these are unlikely to be huge if the interest rates are only slightly less it could be significant. You also need to think about the fact that you might have to pay a fee to your current lender. This might sound odd but many of them have something called and ‘early redemption fee’ which is a charge you will have to pay if you leave early. These are more common if you are in fixed rate period, but they could be on any mortgage. Ask your lender if you will have to pay anything if you swap to a different lender to be sure. Some may only charge a small handling fee but some can be significant amounts of money so you will have to consider that and think about whether this is something that will be worth paying. It can be good to work out how much money you will save by paying less interest and whether it will be more than this fee.
Term – You also might want to think about how long the mortgage lasts, which is often referred to as the term. You might want to extend the mortgage so that you will not have to repay so much each month or you might want to pay it back more quickly so you can end the mortgage earlier. Some lenders will be flexible and will allow you to make extra payments if you want to or pay a bit more back and so it is good to think about whether this might be something that you will find useful.
Repayments – It is also good to take a look at how much you will be expected to repay each month. It might be that you want to remortgage so that you can reduce how much you repay so that you can find it easier to repay each month. If you are struggling with repayments then this can be extremely helpful. It might be that the repayments will be higher though. This could be okay if you are managing fine, but if you are not then you may want to look for lower rather than higher repayments or at least ones that are the same. You also need to take care to consider the fact that if the mortgage rate is variable then it might go up and this will mean that you will have to pay more each month. You will need to calculate whether this is something that you will be able to afford or whether you need to think about going for a fixed rate where this will not be a risk.
Better Service – it is also worth thinking about the customer service and whether you will be switching to a lender that you feel will be better with regards to how well they treat their customers.
An overdraft can be an expensive way to borrow compared to some other borrowing methods. This means that it is important for us to be able to make the right choice when it comes to borrowing meaning that we will get the right loan for our needs which provides good value for money. Therefore, when you use a particular loan is really important. It is well worth asking yourself a selection of questions before taking out a loan, before you choose to do so.
Do I Need to Borrow?
It is a good idea to start by asking yourself whether you actually need to borrow any money at all. You may find that it is not really necessary. Consider what you are using the money for and whether it is something that you will be able to wait for or save up for, rather than borrowing the money to pay for it. It could be a good idea to also think about whether you could cut back elsewhere so that you can afford it rather than borrow. The reason for this is that you will need to think about the fact that borrowing costs money and if you can save money by not borrowing then this can be a great thing. It is always good to avoid spending money unnecessarily if you can.
How Much do I Need?
If you do decide to borrow then you will need to think about how much money you need to borrow. This will differ and depend on the each think that you are buying. It is a good idea to make sure that you think about whether you will be able to put some money towards it or whether you will need to borrow all of the money to pay for it. It is also important to resist the temptation to borrow more money that you need. You may feel that it will be a good idea to borrow a bit extra and then you will have some to spend on yourself, have a treat or perhaps to keep by ‘just in case’. This is not a good approach though because you will find that it will be expensive as you will have to pay interest on the money that you have borrowed and it is better to borrow a minimum amount so that you do not have to pay so much interest on it.
How Much am I Prepared to Pay?
It is also a good idea to think about the total cost of the loan and whether you are prepared to pay that much money for one. It is not always that easy to calculate but look at the interest rate and think about how much you are likely to borrow and for how long and you should be able to calculate it. Think about whether you think that you will get good value for money from the loan or not.
Can I Repay it?
It is also extremely important to think about whether you think that you will be able to repay the loan. It is a good idea to make sure that you will know exactly how much you will need to repay so that you can calculate whether you will be able to afford to repay it. With an overdraft you will not need to repay it on a certain day but it will get repaid when you put money into the account. The longer you leave it unpaid the more expensive it is. You need to therefore be sure that you can repay it quickly and also that you will
If you do not have a very good credit record then you may feel that you have a very limited choice when it comes to borrowing money. This could be the case, but it is best to check this out.
You may find that your credit record is not as bad as you imagine. Take a look at it for yourself and see what is on there. It is important to make sure that it is all correct anyway because you could find that any mistakes are making it look worse than it actually is. It is also worth seeing if there are any obvious things that you might be able to change which will make it better. It might be that there are some loans you can repay or that you can make sure you always make payments on time or something like this which will help. There are plenty of places to look for tips on improving your credit report and it is worth having a look to see what changes you can make to improve yours. However, it is worth noting that lenders never give details on what they are looking for in a credit report and so it is not an exact science knowing what you should be doing to improve it.
No Credit Check Loans
If you want to borrow money and you feel that you have a poor credit record then you may wonder whether a payday loan will be your only option. This is because it is well-known that pay day lenders will tend to be happy to lend money to people that have a poor credit record. However, there are other lenders that will also do this. You can have an instalment loan which is very similar but you do not have to repay in one lump sum but in instalments. You may also want to consider a guarantor loan, where you will be able to borrow larger sums of money but you will need to find a guarantor who is willing to cover any repayments if you miss them. There are also a few others such as a logbook loan which are less common but might work for you.
It is well worth thinking about other options that you might have available though. You may find that these might be better but they may not be and it is a good idea to make sure that you are aware of all of your options so that you are able to choose between them.
If you have any savings then it will be a lot better to use those. This will cost you a lot less. You might be tempted to keep them, especially if you have an idea of what you want to spend them on, but by using them instead of borrowing, you will save a lot of money.
If you can wait for the purchase then you could save up for what you want rather than borrowing the money. Although this will mean that it will take longer for you to get the item, you will save a lot of money this way.
You may find that your local credit union might be able to help you. They often offer loans to people even if they do not have a good credit record. It is worth investigating where your nearest one is and whether you will qualify to borrow from them.
You could also see whether there are any other borrowing options you could take. It could be worth approaching a few high street lenders to see whether you might be able to borrow money from them. You might be surprised. If you already have an arranged overdraft or credit card then it could be possible for you to use those as well.
It can be quite tempting to assume that all lenders are quite similar that offer a certain type of loan. Therefore, you may just use the first one you come across and not bother to compare them. However, you will find that there are differences between them and it is a good idea to actually understand where you might find these differences. Then you will be able to make sure that the loan that you choose will give you really good value for money.
The cost is something that you will need to look in to and then you will be able to compare the lenders and see which is the cheapest and also then see if you think that they are good value for money. Working out the cost may not be as easy as you might think though. You may be tempted just to compare the interest. However, there is more to it than this for most lenders. This is because you will find that you will often have to pay a fee as well, possibly an admin fee or some other charge and therefore you will have to consider that. It is therefore important to make sure that you are confident that you know the exact cost. You can ask the lender to let you know what this is if you cannot work it out and it can be complicated to find out as you are likely to need to read the small print in the terms and conditions so might be easier to check with the lenders anyway.
Amount you Can Borrow
Lenders will have different amounts of money available for people to borrow. This will even vary between payday lenders. Many will lend up to £1,000 though. You may find that some of the lenders will only provide small amount of money to first time borrowers though. This is because they will want to build up trust and make sure that they get their money back, before they are happy to lend a larger amount of money. So, you will need to check how much you will be able to get as you could find that it will be different to the amount that you need.
Most payday loans are repaid on the next day you get paid. They usually have to be repaid in full with both the amount that you borrowed as well as fees and interest, all having to be repaid in one go. It is important to make sure that you can manage to do this or else you will have extra charges. The amount these charges are will change depending on the lender and so it can be a good idea to check this out as well.
Each lender will have different features as well. You will find that some have been around for longer than others, some will have better customer service, be more well-known, have better reviews, come recommended by friends and family and things like this. It is good to think about what is important to you in a good lender and then you will be able to compare them.
So, you can see that there are quite a lot of differences between the lenders. This means that it is important to compare them. You will find that the differences will be greater in some cases than others. It can be worth thinking about what is important to you and then it will be easier to identify the lender which fits closest with your requirements. It will take time but it will be worth it if you get better value for money as a result.
There are lots of different loans available for all of us to take and it can sometimes be really confusing knowing which to use and when. It is a good idea to make sure that you do borrow at the right time and using the right type of loan. Therefore, having a good understanding of the different types of loans and what we can gain from them, will mean that we will be able to choose the right one.
What is a Quick Loan?
A quick loan is just a payday loan. This is a short term loan where a person can borrow up to £1,000. The difference between this and a regular loan is that it is not offered by a high street lender but there are specialist lenders which offer this type of loan. It is also repaid very quickly. The loans normally have to be repaid in full when the borrower next gets paid which means that it will usually only last a few weeks and possibly even just a few days. The lender will also not be worried about whether the borrower has a good credit score. This is because lenders actually brought out this type of loan to help those with a poor credit score as they could see that they had no other borrowing options. They are also arranged very quickly because it was recognised that money would often be needed in an emergency.
When to Use them
No loan should be used for anything and at any time. It is always important to give some thought to the cost of the loan as well as to what you are buying with it. Think about whether you really are prepared to pay for the loan considering what you are buying with it. Quick loans are designed for emergencies, so it is really this sort of situation when you should be thinking about taking out a loan like this. It is a good idea to make sure that you have looked at all of your options to make sure that you are using the loan which is best suited to your needs. Quick loans can be arranged quickly and this can be a big advantage if you need money in a hurry and there is no where else that you can get it from that will be as quick.
You may also be in a situation where you do not have a good credit record and you need to borrow money. It could be the case that you cannot borrow from anywhere else and then a quick loan might be an option for you. It is really important though, that whatever the reason for borrowing using any loan, that you make sure that you will be able to repay it before you take the money out. Make sure that you find out exactly how much you will need to repay and when. Then you will be able to look at your household finances and see whether there will be enough money to cover it. Make sure that you look at whether you will have enough salary to cover it but also think about whether you will be able to afford to pay for all of the other things that you need to buy as well as repaying the loan. It is very likely that you will have other things that you need to pay for, such as rent or mortgage, utility bills, insurance etc and you will also need to buy food and fuel or public transport and so you need to think about how much this will all cost and whether there will be enough money for these as well.