What is a Remortgage?
A remortgage is when an individual, or couple, take out a new mortgage on a property they already own. Remortgage applications usually take place in order to replace the mortgage currently in place or to borrow against a property you own outright.
There are a number of reasons why a remortgage application is made. This includes:
- Refinancing in order to consolidate debt and manage bad credit
- To raise money for home improvements
- Looking for a better rate than your current mortgage
- Refinancing after a marital split
- Raise money for an onward deposit for the purchase of a Buy to Let property
Each person is different and every situation requires a different long-term approach. Adverse credit history shouldn’t necessarily prevent you from mortgaging. In fact sometimes Remortgaging, whilst tidying up other matters such as a current debt management plan, can in the long term improve your credit profile and chances of attaining a high street mortgage in the future.
A Remortgage is not right for everyone. You need to balance out the pros and cons and decide whether it is the right choice for you and whether or not completing a Remortgage transaction meets all of your stated needs and requirements.
There are also options available to you even if you have had bad credit and are looking for a lender that offers adverse credit Remortgages. This includes people who have got defaults and ccj’s, are in debt management plans and have missed payments to some items of unsecured credit.
Most lenders offer an introductory rate that is often fixed for the first few years. Once this initial rate comes to an end you will switch to the lenders standard variable rate. It is at this point when you may consider Remortgaging again in order to attain a new lower fixed or tracker rate.