Capital Raise Remortgages
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Many people want to raise money for an expensive purchase or to consolidate their debts, but raising capital can be challenging. One way to do it is through a capital release mortgage, which allows you to release some of the equity in your property.
Capital raise remortgages are growing in popularity as more people look for ways to boost their finances – but is it the right choice for you?
Believe Money is a UK loans broker specialising in remortgage solutions. If you’re unsure whether a capital raise mortgage is right for you, our brokers can help you by searching through a comprehensive database of lenders, to find you the best deal.
How do capital raising mortgages work?
Most homeowners in the UK have a mortgage, which allows them to own the property while repaying the amount they’ve borrowed in monthly instalments. If you have equity in your property, you can remortgage to release that money as capital.
For example, if your home is worth £350,000, and your mortgage amount is £150,000, then you have £150,000 of usable equity.
Bear in mind when you release equity, you’ll owe more money, meaning your monthly repayments will be higher – but you can use the money released from your capital raising mortgage for whatever reasons necessary: debt consolidation, home improvements, or that luxury holiday you’ve been dreaming about.
Is my property eligible for a capital raising mortgage?
Most properties are eligible for this kind of mortgage as long as you own some equity within the property. Mortgage lenders will consider residential, commercial buildings and mortgage-free properties.
Some lenders will also let you use the second mortgage for a buy-to-let property, so there are plenty of opportunities to improve your financial situation and make a wise investment.
What can I raise capital for?
The great thing about capital raising mortgages is they’re highly flexible. There are many uses for them; some people can even go through their existing lender, which means less paperwork and red tape.
Popular uses of the capital from a remortgage include:
- Buying someone else out: If you own a home with a friend or are going through a divorce, you can use the mortgage to buy out the other party.
- Debt consolidation: One of the most popular uses for a capital remortgage is debt consolidation. Many people struggle with debt repayments, but consolidating them into one monthly payment can make things easier.
- Large purchases: Some people use the capital they raise to pay for school fees, a new car, their wedding or a holiday. While this is less popular than the other uses, it could be an excellent way to pay for something expensive.
- Home renovations: Improvements can add significant value to your property, ensuring you profit when selling it. Whether it’s refreshing the interior or adding another room to your home, you can use the money you raise to pay for renovations.
- Investing: You can also use the capital to fund investments such as a buy-to-let property or business expansion.
As you can see, you can use the mortgage for numerous things, but there are some exceptions. They include:
- Buying a new business
- Investing in shares or stocks
- Paying off any gambling debts
- Settling your tax bills
What are the alternatives to a capital raising mortgage?
If you’re not sure whether a capital raising mortgage is right for you, there are some alternatives available. However, it’s important to remember that mortgages are a form of secured loan, and personal loans often fail to offer large sums of money.
The second-charge mortgage is the most popular option available, which is different from a remortgage, while still offering a lot of flexibility.
Second charge mortgages
A second-charge mortgage is ideal if you’re already getting great terms with your current lender and don’t want to lose them by moving onto another mortgage product.
While remortgaging means you move onto a different deal, a second-charge mortgage is essentially a second loan on your home.
This option means you’ll continue paying your first mortgage as well as have a second one to consider. People with multiple debts can simplify their monthly outgoings by limiting them to two mortgages, but others prefer a capital raising mortgage.
Finding the right mortgage lender for your needs
If you’re lucky, your current mortgage provider might allow you to release equity but stay with them. However, you could need to find a new mortgage provider, which can be challenging if you’re limited to mainstream lenders.
Believe Money is a specialist broker, partnering with private lenders and mortgage providers that offer borrowing solutions to individuals with poor credit.
Our dedicated team can work with you to secure funds, so you can enjoy the convenience of one simple monthly payment.
With zero upfront fees and access to specialist lenders, we aim to simplify the remortgaging process and allow you to enjoy its flexibility.
Please feel free to contact us today. We’d love to work with you.
About Company
We’re here to help you at every step of the remortgage journey. Contact us online or give us a call on 01302 591 360.
Why Use Believe Money?
Believe Money is an award-winning finance broker dedicated to offering the best range of affordable loan options. Whatever your circumstances or credit rating, we’re committed to getting you the best secured loan interest rates by searching our entire panel of secured loan providers.
Whatever you need a secured loan for, we’re here to help. Our specialist advisors are available Monday to Friday, so if you need any help please contact us online or give us a call on 01302 591 360.
How It works
Step 1.
Simple, easy application
Step 2.
We search our panel of lenders to find the deal that’s right for you
Step 3.
When you confirm your chosen deal, we get your application moving
Step 4.
The money lands in your bank
account – usually within two weeks
We compare loans from our panel of the UK’s top lenders to get you the best deal.
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