Additional Borrowing On Mortgage
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Why Choose Us
Why Choose Us
When considering enhancing your property, consolidating debts, or maybe even financing a significant life event, finding the right financial solution is paramount. At Ascot Mortgages, we help clients navigate the realm of additional borrowing on mortgages, ensuring they find favourable terms and rates that align with their financial objectives. As you explore the possibilities of securing extra funds, understanding the nuances of a further advance is key to making informed decisions.
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Written by:
Alison Gibson
Ascot Mortgage Expert
Last Updated:
06.11.2024
Written by:
Alison Gibson
Ascot Mortgage Expert
Last Updated:
06.11.2024
Increasing My Mortgage – What is a Further Advance?
A further advance is a method of additional borrowing on mortgage wherein homeowners can borrow more money from their current mortgage lender. This extra borrowing on mortgage is typically at a different rate to your main mortgage, but it’s consolidated into one monthly repayment.
Essentially, a further advance increases the total amount you owe on your mortgage, but it also offers the potential to access lower interest rates compared to other types of loans. The repayment of this additional sum is spread over the remaining term of your mortgage, making it a viable option for those seeking to leverage the equity built up in their home.
When considering a further advance, it’s imperative to assess the interest rates, additional repayments, and any fees involved. We guide you through this assessment, ensuring you comprehend the implications and benefits of additional borrowing on mortgage, thus empowering you to make decisions that suit your financial landscape.
When a Further Advance Might Make Sense
A further advance or extra borrowing on mortgage might make sense in various scenarios, depending on individual needs and financial situations. Here are some instances where it could be a favourable option:
1. Home Improvements:
– If you’re planning significant home improvements that will potentially increase your property’s value, a further advance can provide the necessary funds.
– We can help you evaluate whether the increase in property value outweighs the cost of additional borrowing.
2. Debt Consolidation:
– Consolidating higher-interest debts into your mortgage can potentially reduce monthly payments and make debts more manageable.
– However, it’s crucial to consider the long-term implications, as spreading repayments over a longer term might increase the overall cost.
3. Major Life Events:
– Funding significant life events like a wedding or education can be facilitated through additional borrowing, especially if the interest rate is favourable compared to other types of loans.
– We assist you in assessing the affordability and suitability of using a further advance for such purposes.
4. Property Investment:
– If you’re eyeing an investment opportunity, such as purchasing a buy-to-let property, a further advance might be a viable funding solution.
– Ascot Mortgages can guide you through the property investment landscape, ensuring you secure a deal that aligns with your financial goals.
Before opting for a further advance, it’s essential to consider alternatives like remortgaging or taking out a personal loan, depending on the amount needed and your individual circumstances. Ascot Mortgages offers expert advice, helping you explore all available options and choose the one that best meets your needs.
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Work Out How Much You Can Afford
Determining how much you can afford in additional borrowing is a critical step in the process. Ascot Mortgages assists you in this calculation, considering factors such as your income, outgoings, the equity in your home, and the impact of potential interest rate changes. Here’s a closer look at the factors involved:
1. Assess Your Income and Outgoings:
– Evaluate your monthly income against your regular outgoings to ascertain how much you can comfortably afford in additional repayments.
– Consider any potential changes to your income or expenditure in the future.
2. Evaluate Home Equity:
– The equity available in your home is a significant factor in determining how much you can borrow.
– Equity is the difference between your property’s value and the remaining mortgage balance.
3. Interest Rates and Loan Terms:
– Consider the interest rate on the additional borrowing and how it compares to your existing mortgage rate and other loan options.
– Assess the term over which the additional borrowing will be repaid and how it impacts the overall cost.
4. Fees and Charges:
– Be aware of any fees or charges associated with additional borrowing on mortgage, such as arrangement fees or valuation fees.
– We provides a transparent overview of all associated costs, ensuring you make informed decisions.
5. Affordability Assessment:
– Lenders will conduct an affordability assessment, considering your income, credit score, and other financial commitments.
– Our advisors guide you through the assessment process, offering insights and advice to enhance your borrowing capacity.
Understanding your financial capacity and the implications of additional borrowing is essential. At Ascot Mortgages, we are dedicated to providing comprehensive advice and support, ensuring you navigate the landscape of additional borrowing with confidence and clarity.
Alison Gibson
Ascot Mortgage Expert
Remortgage
Remortgaging is applied when you keep
living in your present property while applying for another mortgage deal with a new lender. Before finding out how to remortgage and get the best offers from experts like Ascot Mortgages, you have to check meeting what parameters of the deal that can help you succeed the most. The range of background factors varies a lot — from the recently changed loan-to-value ratio or your existing agreement coming to an end.
Whether you are trying to get a more beneficial deal or searching for funding to improve your home conditions, remortgaging is one of the most advantageous scenarios to consider.
Ascot Mortgages – Guiding You Through Additional Borrowing
Ascot Mortgages has established itself as a trusted advisor in the UK mortgage landscape, offering bespoke solutions and expert guidance to clients seeking to increase their mortgages through further advances. Our commitment to transparency, regulatory compliance, and client satisfaction ensures you receive the best advice and service as you explore the possibilities of additional borrowing on mortgage.
Whether you are contemplating home improvements, debt consolidation, funding life events, or property investment, our experienced team at Ascot Mortgages is here to support you every step of the way. We help you assess your affordability, explore various options, and secure deals that align with your financial objectives.
Remember, the decision to borrow more money against your property is a significant one, and it’s crucial to seek professional advice to understand the implications and benefits. Ascot Mortgages is here to provide the insights and expertise you need to make informed decisions about additional borrowing on mortgage. Contact us today to discuss your needs and explore the best solutions tailored to your unique financial landscape.
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FAQ
01/ What can additional borrowing be used for?
Additional borrowing on your mortgage, often referred to as a ‘further advance’, can be used for a variety of purposes. Common reasons include home improvements, consolidating debts, funding significant life events like a wedding or education, or purchasing additional property. Always ensure that the purpose for the borrowing aligns with the lender’s criteria and is in your best financial interest.
02/ How is the interest rate determined for additional borrowing?
The interest rate for additional borrowing is typically determined by several factors: the lender’s current rates, the amount of equity you have in your home, your credit score, and prevailing market conditions. It might not be the same as your existing mortgage rate and can be fixed or variable. Each lender will have its terms, so it’s essential to review the details or speak with a mortgage advisor to understand the best options available.
03/ How long does it take to get approval for additional borrowing?
The time frame for approval on additional borrowing varies but typically ranges from a few days to a few weeks. Factors influencing this include the lender’s current processing times, the complexity of the application, and how quickly you provide the necessary documentation. Engaging with a mortgage advisor can help streamline the process and provide clarity on expected time frames.
04/ Can I pay off the additional borrowing early?
Yes, many lenders allow you to pay off additional borrowing early. However, it’s essential to be aware that early repayment charges may apply, especially if you’re within a fixed-rate period. The terms of early repayment will be specified in your mortgage agreement. If considering early repayment, it’s wise to consult your mortgage advisor or the lender to understand any potential penalties or fees.
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Legal
Ascot Mortgages authorised and regulated by the Financial Conduct Authority and can be found on the FCA register (www.fca.org.uk) under reference 776062. The FCA do not regulate some forms of mortgages. The guidance and advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK. There may be a fee for mortgage advice. The precise amount will depend upon your circumstances but we estimate it will be £599 per mortgage account. Ascot Mortgages Ltd give you the option to pay a non-refundable fee of £1299 payable with the application. If this option is taken, Ascot Mortgages Ltd will refund any procuration fee received by the lender.
Ascot Mortgages Limited is registered in England and Wales and have their registered office at 8 Webster Court, Westbrook, Warrington, WA5 8WD. The company’s registration number is 06764971.
We are a credit broker, not a lender. We work with the whole of the lending market. We may receive commissions that will vary depending on the lender, product, or other permissible factors. The nature any commissions model will be confirmed to you before you proceed.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT
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