If you own a home on a mortgage, there is no reason for you to keep following the same terms for decades to follow. In case of the situation change, you always have the option of remortgaging your property. It would allow you to get better deals and raise huge cash against the equity of your home. So, while you are thinking along the lines of making the most out of the property you have, there are two ways to go about it: you can either go for equity release or remortgaging your home.

The bank of England has recently announced that the base rate would increase starting this year on mortgages. This means that mortgages are going to cost you more now. However, there are still many deals you can avail to make the most out of this option. Every year the house prices go up by £33 allowing you to strike a newer and better mortgage deal.

If you choose to go with remortgaging there are certain things that you would have to be prepared for.
•    Reapply for mortgage and provide sufficient evidence of your incomes and spending.
•    There would be various fees and settlement charges that would eat out the actual amount you are borrowing. So, go prepared for this.
•    Since you would have sold the equity to your lender, the area of the home you own now would be lesser than before
•    There are high chances that the company would refuse to cater to your demand based on your credit, age or income.
•    If you fail to make the repayments, the home you live in would be taken into possession
•    You might not get the full amount that you need.

Equity release
This is another option you can explore if you are in need of cash. However, in order to avail this opportunity, you would have to be aged at least 55 years of age. The money you get as a result of this scheme can be used in any way that you feel like. However, thinking about it strategically, it is always a better option to clear out any debts or extra mortgage payments if there are any for your home.

The best thing about equity release is that it allows you to continue to own your home and live there just how you did before the deal was signed. In fact, the payments that will have to be made would never cross the overall value of your property and thus would not be a burden on you. This also points to another major advantage of going with equity release plans where your children would be entitled to any debt in case you die before paying off the whole amount.

So, before you go on planning something, do read more about equity release and various plans one of the best companies in London has to offer. With finances and the assets, you own, you can just never be careful enough. So, think, compare and research before you decide.

Published by Mudassar Ali