Consider Other Mortgage Options to Reduce your Outgoings
Posted by siteadmin on Tuesday 15th of November 2022.
Step 7: Consider other mortgage options to reduce your outgoings
There are still other avenues to pursue...
Extending your term or switching to interest only can help spread the cost of your mortgage, resulting in lower monthly payments.
Need more answers?
As well as the information above, there are still more options!
If the changing rate, change in mortgage type or LTV% amount isn't enough or isn't an option, think about extending your term.
Extending a mortgage term will, of course, make the amount of time you're borrowing longer. But, there's two important hurdles extending can overcome:
Affordability: Extending your term results in spreading your mortgage amount over a longer period which results in lower monthly payments. Which is ultimately what you're trying to achieve.
Overpayments: By spreading the cost and achieving lower monthly payments, this gives you the opportunity to make over-payments on months when you find yourself with a little more surplus money. Which in turn, comes into benefit when you re-mortgage.
Remember, this doesn't have to be permanent!
When your fixed term comes to an end, whether you chose 2 or 5 years, you can reassess your affordability and with making over-payments, you could be able to bring your term back down to where it would've been before you extended...maybe even lower it.
Interest Only: Is exactly that. You only pay the interest on your mortgage.
**It's worth mentioning that your borrowed amount will not reduce for the duration of this term**
This would be a good solution to discuss with a broker if you are finding that the other steps and options, discussed previously, aren't viable for you to reduce your monthly payments to an affordable amount.
Speak to one of our brokers to discuss this in more detail and to find the right and Wise solution to your re-mortgaging needs.