The Great Dilemma - Remortgaging To Pay Down Debt Or Funding Major Purchases?

As you pay off your mortgage, you build up equity in your home that is tied up and unusable

. But have you considered the idea of remortgaging to release that money from your home? Here are some ideas of how you could use the equity.

Whether or not a remortgage is a good idea for you depends on various factors, including how much funding you require, and what you intend to use it for. Make sure that you consider the fact that your repayments will increase if you borrow additional funds and that your term may well increase too.

Weddings are another expensive event in life that many couples struggle to afford. If you already have a mortgage and have equity in your property, have you considered borrowing additional monies to pay for your dream wedding?

University fees for your children can also be extremely expensive, even to the point of being unaffordable for parents - especially if you have two or more children. Again, by remortgaging and borrowing extra money, you may be able to afford such huge expense without breaking the bank or getting another job.

Travelling is something that many people think about but can't afford to do, so perhaps you could consider getting at the money that is tied up in your home so that you can jet off to experience other cultures and see the world.

Many people in the UK now have unsecured debts which cost a lot of money in interest, and so a remortgage can be used to consolidate these debts.

If you do remortgage for debt consolidation however, beware that you could lose your home if you find yourself unable to continue with repayments, which would be devastating.

Remortgaging can also allow you to afford home improvements that you've been planning for some time, but have never managed to save for. Adding new bedrooms, extending the property or updating the kitchen or bathroom are all investments, because they will also add value to your home.

A remortgage doesn't necessarily mean that you have to borrow more money however. You may just want to see if there is a better deal on offer that can reduce your monthly mortgage repayments.

You may simply want to remortgage just to find a better deal and not have a need for releasing equity from your home, but whatever the reason for seeking a remortgage, consider all of the options before making any final decisions.

by: Timothy Frodsham

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