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:
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.
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.
Key differences between remortgaging to raise capital and equity release products.
How remortgaging can help manage and simplify debt.
Risks and benefits of consolidating unsecured debts.
Funding renovations and how it can add value to your property.
Examples: extensions, kitchen upgrades, energy-efficient improvements.
Using released capital as a deposit for an investment property or holiday home.
Important considerations and potential returns.
How raising capital can support financial stability during retirement.
Alternatives to consider, like equity release products.
Access to potentially lower interest rates compared to personal loans or credit cards.
Flexible use of released funds.
Opportunity to improve overall financial situation.
Potential increase in property value (for home improvement projects).
Possibility of higher monthly payments.
Extending the mortgage term could lead to more interest over time.
Securing debts against your home increases the risk of repossession.
Importance of seeking professional advice before making decisions.
Step-by-step process:
Assess your current mortgage and financial situation.
Calculate potential borrowing capacity with a remortgage calculator.
Compare remortgage deals suited to your needs using Mortgages.Direct.
Consult with a mortgage advisor to explore your options.
Submit an application and go through the approval process.
How Mortgages.Direct simplifies this journey.
Access to a comprehensive range of lenders and deals.
Quick and easy comparison tool tailored to personal circumstances.
Expert guidance to help secure competitive rates.
Save time and potentially money by using trusted industry professionals.
How much capital can I raise through remortgaging?
How long does the remortgaging process take?
Can I remortgage if I have bad credit?
Will remortgaging affect my credit score?
What fees should I be aware of?
Encourage visitors to use the remortgage calculator to explore their options.
Highlight the benefits of taking action sooner.
Call-to-action: "Find the right deal and start your journey to financial freedom with Mortgages.Direct today."
Recap the benefits and considerations of remortgaging to raise capital.
Reinforce the importance of making informed decisions.
Remind readers that Mortgages.Direct is here to support them every step of the way.
By remortgaging you may be able to releasing equity in your home.
People often remortgage to provide money for: