Raising capital through remortgagingWhen it comes to raising additional funds for home improvements or paying off expensive debts, for example, opting to remortgage your home can be an effective option. If you’ve had your current mortgage for some time, then you’re likely at a point where a decent portion of the property is owned by you. When you’re looking to raise funds, this will prompt you to want to use the money that is currently tied up in your home.
Carefully consider a remortgage to help raise fundsBorrowing against your home needs very careful consideration, as for the vast majority of us, our homes will be the biggest financial commitment we have. However, if you are the sort of person who always seeks out the cheapest deals, such as with your mobile phone contract, then you may be missing out on savings by not applying the same to your mortgage. However, it’s important to be aware that there are both pros and cons to remortgaging your property, especially during these uncertain times. This is why it’s always worth speaking to experts, such as a professional mortgage broker, who can advise you on the best options available for your particular circumstances.
Raising additional funds for home improvements or paying off expensive debtsThere are a variety of reasons why you would consider borrowing against your home in order to raise additional funds, with two of the main being to help with home improvements and pay off expensive debts:
Improving your homeHome improvements can be difficult to save for, so it can be beneficial to use a remortgage to help free up funds to remodel your property. Home improvements projects can sometimes take you by surprise, so you might not have long to find the funds.
Paying off expensive debtsBy opting for a remortgage you’ll essentially be releasing equity that’s in your property in a lump sum. This sum can be used to repay your expensive debts that you’re struggling to find the money for. Remortgaging may reduce your monthly mortgage payment also, freeing up money to repay your other debts.
Other reasons why you might consider remortgaging to raise funds include:
- A big purchase such as a car - Remortgaging can help free up funds for when something unexpected happens, such as your current car suddenly packing in. If you’re looking to upgrade your car for any reason, like having more family members, a remortgage can help.
- Further education costs - Raising money for further education can also be achieved through a remortgage. If you’re considering going back into education or you’re helping a family member do so, borrowing against your home can free up the funds required.
- Helping family members with house deposits - Helping a family member, such as your children get their foot on the property ladder can be wonderful. Remortgaging can free up funds to help them with a deposit.
- Extra cash for a holiday - Setting aside some savings for a dream holiday is great, but it’s not always easy to do this. If you’re looking to take the trip of a lifetime or you’re looking to book the perfect honeymoon, remortgaging can provide you the extra funds you might need.
Get as much info as possibleBefore deciding to go through a remortgage, make sure you get as much information as possible. Here are a few key things to consider:
- Your interest rate and the mortgage term you want.
- Your new monthly payments.
- The type of mortgage that will be best for your situation, e.g. fixed rate or variable rate.