Remortgaging to get a better interest rate, flexibility or to consolidate debt
When you take out a new mortgage, you normally get an introductory deal – for example a low fixed or discounted rate or a low tracker rate for the first few years of your mortgage.
Introductory deals normally last for between two and five years.
Once the deal ends you’ll probably be moved onto your lender’s standard variable rate, which will usually be higher than other rates that you might be able to get elsewhere.
So when your introductory period ends, take a look at the market to see if switching to a new mortgage deal will save you money.
Bear in mind that if you only have a small outstanding mortgage the amount you stand to save might be too low to make switching worthwhile.
Remortgaging might also enable you to get a more flexible deal – for example if you want to overpay. Or maybe you want to switch to an offset or current account mortgage, where you use your savings to reduce the amount of interest you pay permanently or temporarily – and have the option to draw your savings back if you need them.
If you have a lot of debt, you might be tempted to borrow some extra money and use it to pay off your other debts. Even though interest rates on mortgages are normally lower than rates on personal loans – and much lower than credit cards – you might end up paying far more overall if the loan is over a longer term.
As a dedicated mortgage broker, PAD Financial can compare mortgages from the whole market and offer you advice on whether to remortgage or stay with your current lender. By comparing mortgage rates, PAD Financial can assess whether you can save money by remortgaging your property.
If you would like to know how PAD Financial can help you, please contact us now.