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Day one remortgages

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Feb 5, 2023

Day one remortgages – What are they, and how do you get one?

Although not all providers offer day-one remortgages, they can be helpful in certain circumstances.

This includes if you have recently inherited a home with a mortgage still due, have purchased a property with cash but want it back out, or are looking for purchase through an online auction.

We explain what a day-one remortgage looks like and how it works in practice.

We also identify the situations where you might need one and what providers may be able to offer them.

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What is a day-one remortgage? How do they work?

A homeowner looking to refinance their property after they have completed the property purchase is called day one remortgages.

Although they are sometimes called day one mortgages, this term applies to all remortgage applications made within six months of the property’s initial purchase.

These are rare because many providers won’t offer a mortgage product to someone who only has the property for six months, if not one year.

They function in the same way as traditional mortgages. They are different because you have to prove that you own the property but this can be challenging if the Land Registry has not been updated to reflect your purchase. Land Registry updates can take as long as six weeks, if not more. Sometimes, your solicitor can be used to confirm.

You will need equity as with traditional mortgages. Providers prefer to see a 75% to 85% loan-to-value (LTV) when it comes to day-one remortgages. It is possible to find a provider willing to go higher.

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Why would you want one?

Day one remortgages may not be expected, but there are many reasons you might need one.

  • You inherit a home and want to use the equity as collateral for a mortgage.
  • You want to finance a mortgage for the renovation of the property you purchased, either with a bridge loan or cash via an auction.
  • You have one property that you own, which was purchased with cash. But, you wish to purchase another property using a mortgage. The equity from your first home will be used to finance the mortgage.
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What mortgage lenders are available?

These remortgage products are offered by Nationwide and Barclays, two well-known names.

Access to these products is not easy, and they have strict requirements as their knowledge will help you find the best mortgage for your needs.

You may also be able to use them for the remortgage products you desire.

How to get a day-one remortgage

It isn’t easy to apply for and get approved by a provider for day-one remortgages.

These steps will help you get your application off to the best start.

  • You must provide evidence of ownership. To be approved by a mortgage lender, you must prove that you are the property owner. If your ownership is new, it may prove difficult to do so; therefore, in these cases, your solicitor can help you prove ownership by verifying the date and cost of the property.
  • Collect your paperwork. You will need to provide documentation to prove your income, identity, and address for any mortgage application.
  • While you’ll probably have most of the paperwork ready when you purchase your first property, it’s possible that your address is out of date, and you will need to get confirmation from the solicitor.
  • Get a credit report. It is a good idea to check your credit reports in advance to know if any problems could affect your ability to get a day-one remortgage. It may also highlight recent borrowings or searches for your first mortgage. You can download your report ahead of time to identify the issues and take appropriate steps to fix them.
  • Talk to a broker who specialises in this area. Brokers can only offer these products. It is a brilliant idea to meet with specialists. You’ll be able to tell them which provider will most likely accept your application based on your circumstances. Their extensive knowledge will help you get a loan at the lowest interest rate.
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Day one: Remortgages for Buy-to-Let Properties

Lenders will often require you to be a homeowner for at least six months to release equity from a property.

Some brokers offer day-one refinancing options to buy-to-let properties. As with conventional mortgages, you will need a broker to access them. If you are not yet on the Land Registry, you must prove that you own the property.

Lenders will generally lend 75% of the property’s equity, but with the right provider, you might be able to get more.

You should also consider that different providers calculate LTV differently, which you should carefully consider when preparing your remortgage budget.

Virgin’s LTV is calculated based on the lower of the original purchase price and valuation. Kent Reliance can lend based on the current property value or the original purchase price, but only after completing any work.

Match with a broker who has been involved in day one remortgages

A day-one remortgage is more complicated than conventional remortgaging. If you are looking for a niche product, a specialist in remortgaging can help you.

You can identify the best providers for you based on your specific circumstances. This will increase your chances of getting a loan and provide you with the best terms.

A free and confidential remortgage broker specialist can help you make the best decision. We can help you arrange for a broker to meet with you by calling us at 0808 301 9509

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Popular FAQ’s

What happens when you complete your remortgage?

Your mortgage will be transferred to another lender if you remortgage. The new lender will pay the balance to your old lender.

If you have changed your mortgage terms and are still with the same lender, for example, if you switch from a repayment mortgage then remortgage to an interest only, they will adjust your monthly payments to reflect the new interest rate. In either case, you will be paid the settlement amount.

What is the best time to remortgage your home after remortgaging

Lenders prefer that you have the property for at least six months. Some lenders may require that you have owned the property for at least six months before you can remortgage, however, you can remortgage at any time.

It can be possible if you can find a provider willing to remortgage you, even if you have recently mortgaged. Due to strict eligibility requirements, day-one remortgages may be challenging to obtain.

Can I remortgage if I am over 60?

If you would like to remortgage over 60 years of age then you may be able to with some lenders, however, fewer lenders will accept you at this age.

Is it possible to remortgage your home immediately?

Sometimes, not always. Some providers won’t consider remortgages if you haven’t owned the property for six months.

Some providers require you to own the property for at least one year, but you may be able to get a mortgage product transfer depending on your current lender.

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