Re-mortgaging is not a new idea with around 30% of home loan applications are re-mortgages. Although the most popular reason for re-mortgaging is to save money on the repayments, there are other reasons why so many people are doing it.
Check out our 7 top reasons why you may consider re-mortgaging
1. Reduce your monthly expenditure
If you currently have a mortgage, there is a good chance that you may be paying out more money each month than you should be. Depending on the size of your mortgage, you could make substantial savings each month by simply changing lenders. Many borrowers regularly switch their mortgage every few years to take advantage of the better rates on offer.
2. You want a better rate
If you’ve been moved onto your lender’s standard variable rate, it’s highly likely that re-mortgaging could help reduce your monthly repayments.
3. Your current fixed deal is ending
When your current mortgage deal ends, your lender will automatically place you on their Standard Variable Rate which will likely be more expensive than your previous deal.
To avoid being put on to your lender’s variable rate, you should start looking for a better deal 6 months before your current one ends.
4. You want to free up some capital (Equity release)
Equity release can be used for a variety of reasons. It can be used for home improvements, debt consolidation or help your child to get on the property ladder.
5. You want to consolidate some debts
Many people are now taking advantage of low mortgage rates to free up equity to pay off their high-cost unsecured debt and reduce their monthly outlays. Debt consolidation is one of the main reasons why people consider re-mortgaging.
If you’re a homeowner and have multiple debts that you’re struggling to keep on top of, you may be able to get your finances back on track by simply re-mortgaging.
Although there is the opportunity of significantly cutting back on your monthly expenditure, you may pay more in interest over the long term especially if your re-mortgage is over a longer period and your home could be at risk if you don’t maintain your monthly payments.
6. Home Improvements
Many people remortgage to release cash to carry out home improvements. As carrying out home improvements may add value to your property, this is often regarded as a sensible investment.
7. Changing your lender
If you are not happy with the customer service levels that your current mortgage provider is offering, you can easily change lender by re-mortgaging.
Is re-mortgaging right for you?
Everybody at some time or other will find themselves having to re-mortgage. Choosing the right mortgage for you can be tricky.
The Mortgage Advice Service provides a free financial review service to help identify the best solution to suit your circumstances.
Our mortgage advisors are available Monday-Friday from 8 am to 8 pm to help you find the best re-mortgage deal to suit your personal circumstances
If you a looking for mortgage advice that you can trust, call us on 0141 956 7756 or on 0800 011 2322 (Free from landlines) and speak to one of our advisors today.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
The Mortgage Advice Service Scotland is a trading style of The Mortgage Advice Service (Scotland) Ltd which is authorised and regulated the Financial Conduct Authority for mortgages, protection insurance, and general insurance products.