For most of us, we are able to afford our homes only via a mortgage. With a mortgage, we are able to acquire beautiful homes in beautiful neighbourhoods with all the amenities we like and desire. In many neighbourhoods, houses usually appreciate in value. Thus, over time, you will have a house that is more valuable than you are paying for. Which is good.
One of the most important features of a mortgage is that you can remortgage. Remortgage means that you can take you an extra amount of financial value on your house.
Here are some of the reasons why you can opt for a remortgage.
To release some monetary benefits on the increase of value on your house
When the value of your house increases in the course of your mortgage payment, you can remortgage based on the difference in the value of the house and the remaining amount on your mortgage payments.
Remortgage for home improvements
Remortgaging for home improvements is another major reason why a lot of people will opt for a remortgage.
Once you have lived in a house for several years, you may want to change how it looks and feels. Most home improvement programs are quite expensive. As such one can opt for a remortgage to meet the costs of remodelling their home to fit their new needs.
To maintain a low-interest rate on your mortgage
When you first receive a mortgage, your mortgage provider offers you a low introductory rate for a given period of time. Depending on your mortgage provider, this period could be 2 or 10 years.
To prevent the low-interest rate from rising by moving your mortgage to standard interest rates, you can opt to remortgage and maintain another low introductory interest rate on the new loan that you have now taken out.
To finish your mortgage payment earlier
You can also opt for a remortgage if you want to finish paying off your mortgage earlier than previously agreed.
For most mortgages, you and your provider agree on the amounts to be repaid. Therefore, when you want to pay above agreed amounts it is often impossible.
You can then take a remortgage that does not limit you to a specific amount of payments and thus you can pay higher amounts on your new mortgage to finish your payments earlier.
You may incur higher charges on your new mortgage for the overpayment. To go around this hindrance, you can opt for a mortgage that has lower charges on overpayments.
You can remortgage for debt consolidation
Debt consolidation is another reason why you can remortgage. However, this is a risky reason for remortgaging as it may lead to the loss of your house if you fail to repay your mortgage as required.
Remortgaging is a wise financial decision should you opt for it. It enables you to gain monetary advantages from the increasing value of your property. Remortgaging allows you also, to enjoy better interest rates and payment plans on your loan.