What is remortgaging?
Remortgaging involves taking out a new mortgage on a property that you already own. It can be completed either with the current lender or a new lender. Remortgaging is used to either replace your current mortgage or borrow additional funds.
Reasons why you may want to remortgage your home
There are many reasons to which an individual may want to remortgage their home. But there a common reasons why people decide to remortgage and take out equity in their home.
- Home improvements
The client may want to enhance the value of their property by extending the property or carrying out a loft conversion. This could increase the value of the property substantially. A remortgage could be a way of funding the improvements at a reasonable interest rate.
- Debt management
The client could have a build up for debt where he is paying various lenders. Here the client can choose to remortgage a property and use the money to pay of expensive sources of debt, therefore saving money on interest charges and also merging all the debt into one lender, which is easier to manage.
- Equity release
Where an individual has a lot of capital tied up in a property or home. A remortgage will allow you to take out money from the property which acts like an equity release but where monthly payments are required. The money withdrawn can be used for investment purposes, purchase of a new property and many more.
- An individual can even remortgage their home and not take out any equity. The purpose of this is to switch lenders to obtain good interest rates available in the market. This is known as a like for like remortgage and could help the individual pay less interest on their mortgage and keep monthly payments low as possible.
If you have any enquiries or need any assistance please don’t hesitate to contact the team at Rosebank mortgage brokers.