What Is A Remortgage?
A remortgage is the process of paying off one mortgage with the proceeds from a new mortgage using the property as security.
It could be that you’ve been on your current mortgage deal, which if fixed, could have lasted 5 years and your circumstances have changed.
Why do people remortgage?
There are a number of reasons that people choose to remortgage, ranging from having more money left over at the end of the month to releasing capital for various reasons.
Get A Better Rate
Many people stay with the same lender because it’s easy, but the truth is by looking elsewhere you might get a better deal. People have saved thousands over the course of there mortgage by getting a lower interest rate with a different lender.
Fund Home Improvements
By using the money tied up in your home to fund home improvements, there’s the double benefit of perhaps borrowing money at the lowest rate available to you and at the same time increasing your property’s value with the improvements that you make.
Consolidate Your Debts
Borrowing money to consolidate your debts can make repaying any outstanding credit cheaper to do so, whilst having the convenience of it being under a single payment you already make.
Reduce your payment term
Another reason people remortgage is to reduce the payment term – by finding a cheaper deal and keeping repayments the same, it can allow people to pay off their mortgage quicker. Others may be happier to pay more if it means owning their home more quickly.
Things to consider when remortgaging
There are a number of things to consider ahead of remortgaging – whilst you may be moving to a better rate, there could be some early repayment fees on your current deal.
Also, depending on why you want a remortgage, another product like a second charge mortgage may be more suitable.
It’s often best to speak with a mortgage advisor in these instances. At The Mortgage Consultancy, we work with over 100 lenders to find you the right mortgage.
Speak to us today about getting the right remortgage.