Remortgage To Raise Capital
Best Mortgage Rates
Remortgage To Raise Capital
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- 3.98% Initial
- 2 year fixed
- 6.9% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.00% Initial
- 5 year fixed
- 6.1% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.02% Initial
- 3 year fixed
- 6.6% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.04% Initial
- 5 year fixed
- 6.1% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.05% Initial
- 5 year fixed
- 6.2% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.07% Initial
- 2 year fixed
- 6.9% APRC
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Cashback £0Free LegalsFree Valuation
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- Halifax
- 4.08% Initial
- 1 year fixed
- 7.6% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.09% Initial
- 5 year fixed
- 5.8% APRC
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Cashback Max £1,000Free LegalsFree Valuation
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- 4.09% Initial
- 5 year fixed
- 5.8% APRC
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Cashback £0Free LegalsFree Valuation
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- 4.09% Initial
- 2 year fixed
- 6.4% APRC
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Cashback £0Free LegalsFree Valuation
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1. Introduction
When your current mortgage deal comes to an end, it makes financial sense to review your options to ensure you are getting the best deal possible. Whilst remortgaging to get a better rate is usually the main reason people move away from their current lender, people also remortgage as they see this as a cost-effective way to raise capital.
Common reasons for raising capital include:
- Debt consolidation
- Home improvements
- Purchasing a second property
- Releasing equity to improve retirement cashflow
Mortgages.Direct provides you with a comparison service allowing you to compare remortgage options looking at current deals in the market.
If you are currently with one of the big 6 lenders representing 80% of the market (Halifax, Barclays, NatWest, Santander, Nationwide, HSBC), then you can see what they would offer you compared to the market. You can also benefit from our mortgage advice service.
2. What Does it Mean to Remortgage to Raise Capital?
Remortgaging to raise capital is where a property owner (residential or commercial) with an existing mortgage looks to move away from their current lender to a new lender.
As an example a homeowner is coming to the end of a 5 year fixed rate mortgage with his current lender with a mortgage balance of £300,000 . The property he/she owns has increased from £500,000 to £600,000 in the 5 years since they took out his original mortgage - a 20% increase. An opportunity has come up to buy an investment property, and a £50,000 deposit is required to put down to secure a buy to let mortgage. By taking out a new mortgage of £350,000 with a new lender, they can still benefit from a market leading rate under 60% loan to value, and release £50,000 towards their new property investment. This remortgage process will involve a new valuation of their current property, and solicitor fees, but even after these costs, this route works out as a more cost effective solution than using a personal loan, or a second charge mortgage where the rate of interest would be much higher.
If you are 55 or older, then equity release is another option for homeowners. Equity release allows homeowners to access some of the equity in their home whilst still living there. The amount you can borrow will depend on your age, and how much your home is worth. With an equity release plan you can pay off your existing mortgage and use any equity released for lifestyle purposes e.g. investing for income. With equity release as interest compounds, it is important to realise that over time the debt on your property will grow, so getting advice on whether this is the right option for you is important. The main benefit of equity release is that you don't make repayments back to the lender while you are living in the property.
3. Common Reasons to Remortgage for Capital
3.1 Debt Consolidation
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A common reason for raising capital through remortgaging is debt consolidation. Unsecured debt is expensive and, if not kept in check, can significantly impact personal finances. Remortgaging can be one of the most cost-effective ways to raise capital.
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However replacing unsecured debt with secured debt care needs to be taken. Ultimately, with secured debt, your home is at risk if you cannot make monthly repayments. It is important to take financial advice before going down this route.
3.2 Home Improvements
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Funding renovations and how it can add value to your property.
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Examples: extensions, kitchen upgrades, energy-efficient improvements.
3.3 Purchasing a Second Property
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Using released capital as a deposit for an investment property or holiday home.
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Important considerations and potential returns.
3.4 Improving Cashflow in Retirement
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How raising capital can support financial stability during retirement.
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Alternatives to consider, like equity release products.
4. Benefits of Raising Capital Through Remortgaging
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Access to potentially lower interest rates compared to personal loans or credit cards.
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Flexible use of released funds.
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Opportunity to improve overall financial situation.
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Potential increase in property value (for home improvement projects).
5. Risks and Considerations
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Possibility of higher monthly payments.
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Extending the mortgage term could lead to more interest over time.
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Securing debts against your home increases the risk of repossession.
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Importance of seeking professional advice before making decisions.
6. How to Remortgage to Raise Capital
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Step-by-step process:
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Assess your current mortgage and financial situation.
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Calculate potential borrowing capacity with a remortgage calculator.
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Compare remortgage deals suited to your needs using Mortgages.Direct.
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Consult with a mortgage advisor to explore your options.
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Submit an application and go through the approval process.
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How Mortgages.Direct simplifies this journey.
7. Why Choose Mortgages.Direct?
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Access to a comprehensive range of lenders and deals.
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Quick and easy comparison tool tailored to personal circumstances.
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Expert guidance to help secure competitive rates.
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Save time and potentially money by using trusted industry professionals.
8. Frequently Asked Questions (FAQs)
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How much capital can I raise through remortgaging?
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How long does the remortgaging process take?
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Can I remortgage if I have bad credit?
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Will remortgaging affect my credit score?
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What fees should I be aware of?
9. Take the Next Step
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Encourage visitors to use the remortgage calculator to explore their options.
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Highlight the benefits of taking action sooner.
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Call-to-action: "Find the right deal and start your journey to financial freedom with Mortgages.Direct today."
10. Conclusion
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Recap the benefits and considerations of remortgaging to raise capital.
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Reinforce the importance of making informed decisions.
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Remind readers that Mortgages.Direct is here to support them every step of the way.
Raising Finance From Your Home
By remortgaging you may be able to releasing equity in your home.
People often remortgage to provide money for:
- Home improvements
- New Kitchen
- New En-suite bathroom
- Consolidate other existing debts.