Is Remortgaging Right For You?
There are a lot of reasons why you might be considering remortgaging, but often they are related to getting some extra money or saving some cash in the long or short term. Read more to see if the switch is really right for you.
A Better Mortgage Deal For You
Everyone's financial situation is always changing and because of this it's a good idea to make sure that you're always keeping a check on if your mortgage fits in with your current situation. If your property is worth more than it was at the time you took out your mortgage then you might be eligible for a better rate with your current lender or a new one because of the increase in equity. If you had a bad credit rating when you took out your mortgage, but it was more than five years ago, you might now qualify for a better rate. You could have even received a large sum of money and want to use some of it to pay off your mortgage. This means that you're borrowing less of your equity and you could qualify for a better deal with another lender because of it. There are lots of changes in situation that can mean you qualify for a great remortgage deal and it can ultimately save you a lot of money.
Obligation Free Remortgage Quotations
Get a Quote »Consolidating Your Debt By Paying Off Loans And Cards
As a general rule, credit cards and personal loans and anything related to them have much higher interest rates that a mortgage or remortgage does. The monthly payments are staggered so that you pay off the debt in three to five years and if the financial situation changes this can make the repayments much less affordable. If you replace this debt with money from your remortgage you could significantly reduce the monthly payments that you're making. This can be much nicer for your cash flow, but remember that the reason the payments are smaller is because you're paying it back over a longer period of time. For many, however, the reduction in monthly payments greatly outweighs the longer repayment period.
A Better Interest Rate On Your Mortgage
Some people change their mortgage regularly not to raise some more money, but to save money by getting a much lower interest rate. Having a lower interest rate means that your new lender will charge you a lot less for borrowing money than the previous one did and this can sometimes mean having a lower monthly repayment. However, if you have a capital repayment mortgage you'll find that you can keep the payment amount the same, but simply pay it off quicker than you would have done previously. Interest rates are currently at an all time low and for a lot of people it is the perfect time for them to consider a remortgage.
Raising Money By Releasing Equity In Your Home
The equity in your home is the difference between the value of your home and any mortgage that is secured on your home. If you've been in your home for a long time, then chances are the equity on your home has increased- often by quite a lot. Remortgaging would allow you to take some of the equity (often up to 90%) and use it for any legal purpose. People use their remortgaging money to do all sorts of things from weddings, making extensions and even holidays or new cars.