Can I Change My Mortgage Lender with a Secured Loan?

Yes. Many lenders will allow you to apply for a remortgage even if you have a homeowner loan secured on your property.

There is a simple process for switching your mortgage to another provider. Firstly, you need to be sure that the new lender is prepared to accept that there is a loan secured on your home. Many high street lenders including Santander and Cheltenham and Gloucester will typically agree a remortgage in this situation.

When the legal work for the remortgage takes place, the solicitors have to complete a ‘deed of postponement’. This temporarily removes the legal charge that the secured lender has over your home. Firstly, your current lender’s loan is repaid and their legal charge over your home is removed. The solicitor then ensures that your new mortgage company has the first legal charge over your home, before re-registering the second charge to your loan company.

You should bear in mind that there may be a cost to you for doing this. Although many remortgage lenders will meet the costs of the simple legal work involved in a straightforward remortgage, they will generally not pay for any additional work. As this process involves postponing and re-registering a legal charge on your home, you can expect to receive a bill for the costs of this. It will typically be around £200-300 depending on the solicitor. Always check with the remortgage lender what the costs will be.

If you want to keep your secured loan, obtaining the ‘deed of postponement’ may also take some time, delaying the completion of your remortgage.

Of course, if you plan to remortgage, you may also have the options of borrowing an additional amount on the mortgage to repay both your existing mortgage and the secured loan. Again, depending on the equity in your home and your personal circumstances, a lender may allow you to consolidate your homeowner loan into your remortgage.

To use your home to raise money at a competitive APR, please fill this homeowner loan form.