Debt Consolidation Remortgages

What is remortgaging for debt consolidation?

Remortgaging is a way to replace your current mortgage product with new terms – often changing the amount you pay each month. By remortgaging your property you can free up a lump sum, which can then be used to clear other debts such as credit card repayments.

For example, if you were to remortgage your property and free up a lump sum of £5,000 to pay off an outstanding credit card debt in full, you could save months of potential interest and credit card repayments, at the expense of a slight monthly increase on your mortgage costs.

On other occasions, a debt consolidation remortgage can be used to reduce your overall monthly commitments. Whilst this may be a way of easing your financial circumstances, it may mean extending the term of the debts, which could increase the overall costs of repayment. You must be aware that you would be securing previously unsecured debts against your property.

Benefits of remortgaging for debt consolidation

Remortgaging for debt consolidation could be beneficial for your overall finances. A few positive factors are:

• Consolidating your debts into one single, monthly payment can make them much easier to manage and potentially much more affordable.
• You may be able to agree reduced payment terms with your lender if you already own a large portion of your property, lowering your monthly mortgage payments.
• You may be able to switch lenders to a better service, or find more manageable terms.
• A lump sum can help you when you need it most. Just be certain you can afford any fees or changes to your mortgage repayment plan if you do.

Disadvantages of remortgaging for debt consolidation

There are also several disadvantages to consider too. It’s worth doing plenty of research before any application and weighing up whether remortgaging is the right move for you, financially. Several disadvantages include:

• You may increase your monthly repayments as part of your new terms.
• You may end up paying back for a longer period of time, meaning you’ll pay back more in total than you originally planned.
• There are several fees to consider as part of the application process, especially if you switch lenders. You should be certain you could afford to cover these as part of your application.

Am I eligible for a debt consolidation remortgage?

Borrowing on your property to tackle other financial concerns is a common occurrence among homeowners. Your application is dependent on a variety of factors, from current debts to whether you’ll be able to cover the costs of your increased payments.

Commonly asked questions about remortgaging

Still undecided on whether to consolidate your debts through remortgaging? We’ve answered some of the most common questions below.

Remortgaging details

• How much can I borrow?
  Borrowing rates range from £3,000 to £500,000 with a Norton Finance remortgage package.
• How long are the repayment terms?
  Flexible repayment terms mean you can spread the cost over 1 to 40 years.
• Are there any loan fees?
  We get our commission from the lender not the customer. We may charge a broker fee of £995.00 and for customers who require a specialist lender, we will charge a fee of 12.5% of the loan amount capped at a maximum of £4950 for our services.

Can I pay off a remortgage early?

You can pay off your balance at any time, however it’s worth noting that many lenders may charge an Early Repayment Fee dependent on the product. It can be great to pay off your loan early, although it’s worth checking whether it is in your interest to consider doing this.

Applying for a consolidation remortgage

There can be a lot to consider when it comes to remortgaging for debt consolidation. You’ll first need to know how much you want to borrow, then just follow our easy online application process and we’ll get to work in helping you obtain the funds you need.