When the tie-in period for my Abbey repayment mortgage ran out after 5 years, they sent me an offer of a better value mortgage and I thought 'How lovely - clearly they aren't trying to rip me off' - and then I never did anything about it, so like a mug I have been paying some sort of standard rate for years.
My house has tripled in value over the last ten years, judging by a web site listing actual sales prices of comparable neighbouring properties.
I want to remortgage, not just to get a better interest rate, but also to extract some of the equity to repay high interest debt.
When I was put through to the Abbey retention team I expected I'd be talking about a new mortgage altogether but their line was 'Oh no, there'd just be additional borrowing on the existing mortgage'. They did say that a better interest rate could be negotiated on the additional borrowing but it was a phone conversation, difficult to ask detailed questions and I got lost in all the financial gobbledegook.
My question is, is it normal practice to view remortgaging with equity withdrawal as 'additional borrowing on an existing policy' or am I being ripped off? Could it ever be in a borrower's interest to do things that way, e.g. not starting another tie-in period which would presumably be the case if I went to a completely new lender like, say, Nationwide?
S