Remortgage Advice

A remortgage is when you switch from your current mortgage to another product. This doesn’t involve moving home, but does mean replacing your financial agreement on the property with another. In most cases, a remortgage is done to get to a better rate or unlock extra funds.

When you sign a mortgage agreement and move in, you aren’t locked into the same rate for the entire repayment period. Though you may have an initial tie-in period where there are penalties for switching your mortgage, outside of this you can look for a better deal. So, if you feel your agreement is no longer providing the best value, you can shop around then make the switch over to a completely new product.

To Consolidate Your Debts
Remortgaging can allow you to consolidate other debts, like car loans or credit card balances. You release some of the equity in your home and take out a new mortgage with a new lender for a higher amount, then you use the additional money to pay off your other debts, consolidating them all into one – your new, larger mortgage.

We recommend that you think carefully before consolidating your debts this way. A new mortgage can help you organise what you owe and meet payment deadlines, however mortgages are over longer periods of time than credit cards and personal loans so you may end up paying more overall, despite the fact they usually come with much lower interest rates.

Nonetheless, sometimes it really could be the best option. It’s important to seek advice before you commit to consolidating your debt. You’ll need to make sure that you can keep up with the repayments, otherwise you risk the repossession of your home.

To Raise Money
Higher income or a rise in your property’s value means you could remortgage and raise more money to help pay for major outgoings, like home improvements, a wedding or your child’s university costs. This could save you from needing a separate loan.

To Avoiding Moving Home
A remortgage can be a convenient way to raise funds for home improvements – like an extension, an upgraded kitchen or a second bathroom. That way, you don’t have to uproot your lives and move to accommodate changing needs within the family.