Remortgaging is simply switching your current mortgage for another one, either with the same lender or a new lender. By remortgaging, you may be able to get a better deal, with a lower interest rate and smaller repayments. It can also be a good way to release equity in your home to free up cash, especially if your home has risen in value.
Benefits of remortgaging:
- Switch to a lower interest rate and save money in the long term
- Free up money by switching to a deal with smaller monthly repayments
- Raise money through equity release
For example, if you’ve paid off 50% of a mortgage on a home that you paid £200,000 for, but the property is now worth £300,000, your equity in the property is now worth £200,000.
If you have high interest unsecured debts and can remortgage to release money at a lower rate, this could be a cheaper way to clear those debts. But it’s essential to remember that your home is at risk if you can’t keep up repayments.
We advise that before you remortgage any property that you speak to a financial advisor to see what other options are available to you. If you are considering remortgaging your property in order to release equity in order to pay unsecured debts, we can offer free and impartial advice on the best way to do this.