Many people remortgage their homes and have good reasons for doing so, but everyone's circumstances are different and a remortgage may, or may not, be the ideal solution for you.
To help you decide whether you should consider remortgaging your home, we’ve put together this brief guide where we'll look at the pros and cons of remortgaging, but first:
What is remortgaging?
Remortgaging is when you take out a new mortgage on the property you already own, or it can replace an existing mortgage.
Why do people remortgage?
After taking out your mortgage, you might find that your financial situation may change. For instance, your pay might go up, your financial commitments could increase or decrease etc. All of these circumstances mean that now could be the right time to remortgage.
The benefits of remortgaging
- Your monthly repayments could reduce.
- You can find a mortgage more suitable to your current circumstances.
- You can release equity in your home
- A remortgage can provide funds for home improvements or a large capital purchase.
- You may be able to take advantage of lower interest rates.
The drawbacks to remortgaging
- It may not be the right time.
- Increasing your mortgage term could increase your debt.
- A remortgage could increase your repayments.
When should you consider remortgaging your home?
There are times when it makes sense to remortgage your home, but before you make any decisions, you should consult a professional adviser. Our fully qualified mortgage advisers will be able to find the right mortgage to suit your circumstances. Your adviser will be able to meet you at your home in Hull or arrange a meeting at our premises on Newland Avenue, if that is more suitable.
Consider making an appointment with one of our advisers here at Mortgage Advice Bureau if:
- Your short-term fixed rate or tracker deal is about to expire.
- Your home has increased in value.
- You want to change to a fixed rate mortgage from an interest only arrangement.
- You think the interest rate is too high on your current mortgage.
- You want to use your equity to raise cash.
- You wish to consolidate all your debt
Although remortgaging your home often makes sense, there are occasions when you should sit tight with your current mortgage, especially if you have low debt. With the fees involved in remortgaging, it may make financial sense to continue with your current arrangement.
Similarly, if your circumstances have changed, for example either your or your partner's pay has decreased, or you’ve become self-employed, it may be difficult to match the terms of your original mortgage. Other circumstances which may make it unwise to remortgage could include:
- Your home has dropped in value.
- There is little or no equity on your property.
- You've had recent credit problems or a CCJ.
The difficulty with remortgaging
The major obstacle to anyone looking to remortgage their home is finding the right mortgage. Comparing other mortgages to your current arrangement can be confusing. Where do you even start? Don't worry we can help.
Our advisers have access to 12,000 different mortgages and will be able to find the right product to suit your personal circumstances. Our mortgage advisers will listen to your needs and help you weigh up the pros and cons of remortgaging, so you can make the right decision for your needs.
We offer free, no obligation appointment; just call Mortgage Advice Bureau Hull on 01482 470444 and ask to speak to a mortgage adviser or click here.