Home Improvements: Many people want to make improvements to their home, but don’t have the cash to hand to do it. This could be to improve the standard of living, or simply to add value to the property so that your investment is greater and the price would be higher if you decided to sell.
Home improvements can be as small as repainting the rooms, or as big as refitting the kitchen or bathroom. You could even do something like adding a pool to the property, but if you do, make sure that you don’t devalue the property by taking up too much valuable garden space.
Having the windows replaced is also another great home improvement that can add value to your property, and it often helps to save money on utilities too as less heat is lost from the property. Conversions and extensions are also a popular way to use remortgage capital as these can add a lot of value to your home.
Finding a Better Deal: Some people simply remortgage in order to obtain a better mortgage deal. For instance, if your fixed rate mortgage comes to the end of the fixed rate period, you may wish to remortgage to go onto a new fixed rate deal rather than reverting to the standard variable rate.
Obviously this totally depends on the market conditions at the time, but a remortgage is a great option nonetheless to reduce your monthly mortgage repayments. Also, if your circumstances have changed, you may want a different product, such as an offset mortgage to pay off lump sums.
Debt Consolidation: If you have credit cards and loans, it may sometimes be easier to reduce your outgoings by getting a further advance remortgage, and using the capital to repay the debts with higher interest rates. One thing that you do need to beware of though, is that by stretching the credit repayments over a longer term you may end up paying more.
The upside however, is that in the short term your monthly outgoings could be reduced. If you have a credit card at 20% for instance, the interest rate can be reduced to 5% or 6% by consolidating it onto the mortgage.
If you want to work out how much more you would potentially pay over the longer term by consolidating your debts, you could opt to use the services of a financial adviser who can do the maths for you.
Purchases: Finally, if you need to purchase a car for instance, you may be able to do so by getting a further advance. The same warnings apply however, as items such as vehicles lose value very quickly, yet the debt will still be payable over the term of your mortgage which can end up being very expensive.
James McHeggins writes for JustRemortgages.com one of the UK’s top sites for the latestand best .