There has been a 29% increase in searches for debt consolidation products on a year-on-year basis – more people are looking for ways to ease their debt.
If you have existing debts in different places, perhaps you struggle to manage them all at once and want to feel more organised and in control of them by streamlining your finances?
A debt consolidation mortgage could be the perfect solution for you. Read more about debt consolidation mortgages here, understand more about them and whether they could be a suitable option for you.
Understanding What A Debt Consolidation Mortgage Is
This is a useful type of mortgage for homeowners who may not wish to sell but want to combine their debts to help with managing their money, having the debts compiled into one convenient place.
Consolidating debts into a single loan can streamline your finances. The application process is similar to that of a standard mortgage, however, the main difference here is that the focus will be down to the equity in your property.
Is It a Good Idea to Consolidate Debt With Mortgage?
According to data from the Office of National Statistics (ONS), a staggering one-fifth of homeowners in the UK with a mortgage have borrowed money to consolidate debt.
Depending on your circumstances this could be a great option for you. If you have high interest rates elsewhere on loans and you are paying a lot of interest on them when consolidating your debts could lessen your interest rates and stop you from paying as much in the future.
If you want to limit the amount of debt you have to think about and worry about then consolidation through a consolidation mortgage can definitely help with this.
With one debt payment in one place, you can also improve your credit rating whilst reducing the chance of making a late payment by mistake.
The Pros of a Debt Consolidation Mortgage
Borrowing on your mortgage to help you manage and pay off your debts elsewhere could be a smart move, depending on your circumstances.
Here are some top pointers to remember that are the pros when it comes to a debt consolidation mortgage:
- Streamline finances
- Could lower your interest rate
- Reduce your overall monthly payment
- Can improve your credit score
The Cons of a Debt Consolidation Mortgage
Debt consolidation can be a great option for many, but of course, this does not come without its share of risks that you should be aware of:
- Upfront added fees
- It could raise your interest rate resulting in higher interest levels over time
- You might not qualify for a favourite
- It may not solve your underlying financial issues
- May create the illusion you have more to spend
Can I Remortgage for Debt Consolidation?
Yes, you can do a debt consolidation remortgage to help you clear debt by using the equity you have in your home. This will increase your mortgage but free up additional funds which can be used to pay off any debts from elsewhere.
If you have credit card debt or personal loans to pay off, then remortgage could ease you of your financial stress.
JG Mortgage Services Limited Can Help You
At JG Mortgage Services Limited, we are an independent mortgage brokerage with a team of qualified mortgage advisors who are built on trust and respect. We always have your best interests at heart.
We have access to a wide range of specialist lenders that will have the means to make you an offer, and we know all of the right people to go to.
Our team of experienced professionals can support you with whatever your mortgage case may be, even in the most challenging of circumstances – we will do our very best to help you.
Whether you need a debt consolidation loan mortgage, you are a first-time buyer or are self-employed looking for the right mortgage deal, we offer telephone, online or face-to-face appointments for your convenience.
Contact us today if you have any queries or wish to speak to a professional about your deb consolidations and wish to find out more about debt consolidation mortgages. Call us on 01244 738422, or email us at info@jg-mortgage.com to discuss things with us further.
