There are risks to remortgaging that many homeowners should take into consideration when it comes to taking out cash from a property’s equity level.  It is of course, often the one way to get affordable borrowing to meet either debt consolidation, an investment, or even to keep a small business afloat.  Yet, it can be putting the family home into jeopardy and should be something a homeowner thinks about before taking out a remortgage.

When obtaining a cash release equity it means that the homeowner is adding debt back on to the property.  Equity in basic terms is the level of ownership in a property.  It is the value of a property minus the debt of the property.  When equity levels are reduced through a cash release then that means the debt level increases.  It also means that the debt on the property has increased. 

This could pose a risk to the homeowner who may be having cash flow problems.  Sometimes it may seem like there is no other option available or one that makes as much sense as releasing equity to raise funds.  Despite what may seem clear to the homeowner there are questions that should be asked.  Are budget demands in the near future going to be able to handle the new remortgage monthly payments?  Is this financially the best resource for added cash flow?  There are an abundant number of questions to be addressed.  If the answers can all be met with confidence then the cost of borrowing through a remortgage is currently at very low levels and there are many remortgage product offers available.