Considering equity release or remortgaging your existing residential mortgage?


Are you hoping to release some of the funds tied up in your home, but are struggling to decide between equity release or whether to remortgage your existing residential mortgage? If so, this is something we can help you with.

Whether you are swaying more towards remortgaging your current mortgage, or freeing up funds through equity release, both of these routes require careful consideration.

At The Equity Release Experts, we’re here to help you understand the options available. So before you decide whether equity release or a remortgage is the right answer for you, call us on 0800 188 4812 or request a callback for a free, initial consultation.

 

How does remortgaging your existing residential mortgage work to release funds?


If you are a homeowner with an existing mortgage, you may want to know if you can remortgage to release additional funds. To access some of the funds tied up in your home this way, you will have to organise a new mortgage deal that is larger than your current mortgage.

The process of remortgaging your existing residential mortgage to release capital isn’t the same as taking out a completely new mortgage. This is due to the fact that you are already the homeowner, and you’ve more than likely been paying off your mortgage for quite some time – or perhaps even paid it off completely. Over the period of owning your home, you will have built up equity, and this is the value that you will be borrowing against. Any calculation regarding your LTV (loan-to-value) will be based on property value and not the remaining equity in the property.

If you’re wondering, ‘can I remortgage to release funds’, it’s important to know that this option isn’t suitable for everyone and if you decide you’d like to go ahead, there are some eligibility criteria you will need to meet. These are explained under the 'things to consider with remortgaging' section below. 

There are differences between remortgaging your existing residential mortgage to release funds and freeing up funds through equity release. If you’d like more information on equity release, receive expert advice from advisers you can trust by calling us on 0800 188 4812 or requesting a callback.

If you want to investigate the option of re-mortgaging your existing residential mortgage, please get in touch

 

Things to consider with remortgaging

  • You'll need to prove affordability before being accepted
  • You could be refused based on your age, credit history or income
  • Remember a mortgage is secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
  • Some of your funds may be used to cover costs and fees
  • You should always think carefully before securing a loan against your property

 

Can you release funds without remortgaging your existing residential mortgage?


It’s important to note that a lifetime mortgage, the most popular form of equity release is a type of mortgage. A lifetime mortgage is a loan that’s secured against your home that’s usually repaid once you or the last remaining applicant pass away or move into long-term care, it’s an alternative way to release funds tied up in your home other than going down the typical remortgaging route.

Equity release is available to homeowners aged 55 and over whose properties are worth more than £70,000, the most popular form of equity release is a lifetime mortgage.

By releasing some of the equity from your home, you will be able to access a portion of your property’s value. When taking out equity release any outstanding mortgage or secured loans must be cleared. You will be able to use the funds released with equity release to clear any existing mortgage or secured loans and then the remaining tax-free funds will be yours.

This money is a great way to help boost your finances at this stage in your life. You might want to use it to clear existing debts, go on holiday or make improvements to your home.

How much you can release depends on several things such as your age, health and lifestyle, and your property’s value. By using our free, no-obligation equity release calculator, you can see how much you could release in no time at all.

 

Talk to the experts


As with any big decision, you should always seek expert advice before going ahead. Whenever you need us, we’re here to make recommendations that are in line with your needs and ambitions. For more advice on equity release, call The Equity Release Experts on 0800 188 4812 or ask us to call you back. We are available from Monday-Friday, 9am-5.30pm. The Equity Release Experts are only able to advise you on equity release. 

 

Things to consider with lifetime mortgages

  • A lifetime mortgage is a loan secured against your home.
  • With a lifetime mortgage there are typically no monthly repayments to make as the loan, plus roll up interest, is repaid when the plan comes to an end.
  • Equity release will reduce the value of your estate and may affect your entitlement to means tested benefits.
  • Unless you decide to go ahead, The Equity Release Experts’ service is completely free of charge as our usual advice fee of 1.99% of the amount released would only be payable on completion of a plan, subject to a minimum advice fee of £1,499.
  • You should always think carefully before securing a loan against your property