Remortgage
You
can do this to access equity in your home in the form of cash, to
consolidate debts or for a better rate of interest. If you have had
your mortgage for several years it is likely that you have built up
equity in your home which you may be able to access, you also might be
paying at a higher rate than people who are taking out brand new
mortgages as banks often give better rates to new customers than they
do to their loyal customers (strange but true!)
Debt Consolidation
Taking
all outstanding loans and turning them into one loan at a lower
interest rate than homeowners would normally pay for car loans, credit
cards or personal loans.
This is a more efficient way of meeting those monthly commitments.
Here is a typical example showing how consolidating your loans can reduce your monthly bills.
| Amount | APR | Monthly Repayment |
|
| Mortgage | € 150,000 | 4.96 % | € 758 |
| Carloan | € 12,000 | 9.5 % | € 280 |
| Personal loan | € 15,000 | 10 % | € 380 |
| Credit Union | € 4,500 | 12 % | € 140 |
| Credit Card | € 2,500 | 21 % | € 75 |
| Total | € 184,000 | €1633 |
New situation
| Mortgage | € 184,000 | 4.8 % | € 973 |
| Total monthly saving | € 660 | ||
| Total annual saving | € 7,920 |
Equity Release
Equity
is the difference between the value of a property and the mortgage
outstanding on the property. As property values have increased
significantly in Ireland over the last number of years people can
release the built up equity for other borrowing options. Typical
reasons to take out an equity release loan would be
- To purchase another property
- To purchase an asset such as a car.
- For home improvements
- To pay for a holiday, wedding, college fees.