When you remortgage you are ending your old mortgage deal and switching to a new one, involving taking out a new loan (mortgage) on your existing property. The process of remortgaging is the procedure of switching to a lender offering a product or rate that you are happier with.

This process can be compared to switching other services as many people do with their gas, electricity or telephone providers.

A remortgage can also be used to raise additional finance by releasing equity in your property, or consolidating other debts into your mortgage. This means you may wish to replace credit card bills, personal loans and other loans with one lower interest rate remortgage and spread lower payments over a longer period.

It is important to note that there are costs attached to remortgaging such as Early Repayment Charges. These need to be taken into account when you are considering a remortgage. Taking short term debt over longer periods has to be considered very carefully when making any financial decision. It is however worth bearing in mind that often the benefits of remortgaging can outweigh the costs involved, but each case is individual, so that may not be the case for you.

Remortgaging is simpler than moving house, so the process of remortgaging can be much faster than taking out a new mortgage on a new property.

Read more about the benefits of a remortgage...