What is the process and costs?
Are there any legal costs involved in re-mortgaging?
When re-mortgaging you will need to consider the following costs:
- legal expenses;
- land registry fees (including the registration fee and document download costs);
- any mortgage arrangement fees;
- bank transfer fees;
- any early repayment fees on your current mortgage;
- a valuation or survey fee; and
- notice and document fees associated with the management company/landlord if the property is a leasehold or on an estate where you pay a ground rent or service charge.
Whilst this may not be an exhaustive list, it would cover most transactions. You should seriously consider the cost of the re-mortgage when budgeting as it can become expensive. Both your financial advisor and solicitor will be able to give you cost estimates if you ask them, which should be of some assistance.
Will re-mortgaging affect my original FHTB loan agreement?
Re-mortgaging will not affect your original agreement. The terms of repayment are fixed and will not change regardless of what other charges you have on the property.
If you chose to repay the FHTB loan in full or part because you are re-mortgaging, you can send a cheque or banker’s draft to pay it off at any time. Please speak with your Unit HR Administrator (RAO or equivalent) or your legal advisor for further information on this.
The FHTB loan will be interest-free except where the property is being let, you have failed to repay the loan prior to the property being sold or you breach any of the FHTB terms which you have agreed to as part of the original loan. If you fail to comply with these rules the loan will immediately start accruing interest. Therefore, if you fail to tell FHTB about any re-mortgage or transfer the FHTB loan to a second purchase and retain your original property FHTB will backdate interest from the date of the breach of the terms of the loan and you will become immediately liable to repay all of the loan.
Your main points of contact
Without a doubt the three main points of contact when re-mortgaging should be your mortgage broker, your solicitor and Unit HR Administrator. Your mortgage broker and legal advisor are there to act for you and make sure that everything runs smoothly with the money and legalities. Your Unit HR Administrator will be able to help you with any FHTB enquiries you may have and also will have the contact details for FHTB and where to send all of your documentation to.
Please use these contacts, it is their job and will make your transaction so much easier. A solicitor and broker with experience in forces life or dealing with military personnel can be invaluable in terms of guiding you through the process with a real empathy and understanding of your position.
Hannah Stockham, a specialist solicitor and Forces Family Finance have teamed up to give you some information on the ins and outs of the process in this 5-part blog series.
For more information or advice on Forces help to buy or mortgages contact Forces Family Finance on 0330 3322 614 / customerservices@forcesfamilyfinance.co.uk or Hannah Stockham for expert legal advice on 01372 237070 / hannah@gallowayhughes.co.uk.
