It is possible to remortgage a property shortly after you buy it. However, there are a few options to consider and you will need to assess your situation and the way you bought the property to decide which will work best for you.
Reasons to remortgage a property shortly after buying include:
- Needing to pay back a friend or relative who lent you money in order to buy the property
- Having purchased the property with cash at an auction
- Needing to bolster your savings after using them to buy the property
- Requiring additional funds to carry out unexpected repairs or improvements to the property
- Looking to switch to a normal mortgage product after having purchased and renovated an unmortgageable property using a bridging loan or development finance
- Wanting to consolidate your debts
You may also wish to remortgage a property you recently inherited or were given.
How long do I have to wait before I can remortgage a property?
Most lenders will only allow you to remortgage after your name has been on the title deeds for at least 6 months. However, there are some options if you need a quicker solution.
As a whole-of-market mortgage broker, Think Plutus can access lenders that will consider a remortgage earlier than that 6-month period. Many of them will need you to be registered as the property owner at Land Registry, but there are even some who will consider your application before your name is formally on the title deeds. It can take several months for Land Registry to add your name to the title deeds, so they often backdate the records. This means you will be recorded as the property owner from the date the purchase was completed.
If I buy with cash, can I remortgage quicker?
Even with a cash purchase, that minimum 6-month period of ownership would still typically apply before you could remortgage. However, if you bought a property with cash, the process of remortgaging is simpler, because there is no existing mortgage to replace.
What is a day one remortgage?
There is no mortgage product called a ‘day one remortgage’. It is merely a phrase that describes a scenario in which someone wishes to remortgage within 6 months of becoming the owner of a property. You can begin applying for a ‘day one remortgage’ immediately once the purchase is completed – the same day, if you like.
It’s best to work with an independent mortgage broker like Think Plutus if you need to remortgage quickly like this. It is a very niche market and there is little information available to do it yourself. What’s more, only a limited number of lenders will accommodate this need. We have access to the specialist lenders who offer the best day one remortgage products.
Can you remortgage?
There are several factors that will determine whether or not you can remortgage. These are:
- The type of property: New-builds can sometimes have restrictions on loan-to-value (LTV) because they are frequently sold at a premium.
- Your reasons for remortgaging: Lenders have different LTV limits for different situations – it will vary depending on whether you wish to consolidate debts, make home improvements, etc.
- Whether the property is your main residence or a buy-to-let: The average LTV for main residential mortgages is usually higher, with a maximum LTV of 90%, whereas a buy-to-let one usually has an LTV of ~75%
- Your personal circumstances and finances: In other words, your affordability. This is what lenders assess when deciding how much you can comfortably afford in monthly mortgage payments.
If you have any questions about remortgaging, whether within the first 6 months after purchasing or beyond, please feel free to contact Think Plutus and ask for advice.