How to Refinance and Create a Better Financial Future

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By Michelle Tuvey.

Loan Underwriter

Your home is likely the most expensive thing you will ever purchase. Moreover, if you are similar to most people, the cost of paying for your mortgage and maintaining your home is the single biggest drain on your budget. Would it not be nice to refinance in order to create a better financial future for yourself? Well, you can. Your financial situation can be made significantly better if you know how to refinance your home.

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For starters, it is important to distinguish the differences between a traditional refinancing home loan, a secured loan, and a second mortgage. Refinancing your home is the process of obtaining a new mortgage that pays off your existing mortgage. A secured loan is a sort of personal loan that allows you to borrow against the equity in your property. Finally, a second mortgage is an additional loan that you pay alongside your original mortgage. You have two loans and two payments.

We recommend refinancing using a secured loan. Why? Because it is easier to get and more cost-effective than a complete mortgage refinancing package, and it is better for your monthly budget than a second mortgage.

Now that you know the difference between refinancing and taking a second mortgage, let us talk about why you might refinance with a secured loan and how to get the best deal.

Reasons for Refinancing

There are a handful of very good reasons to consider refinancing with a secured loan. One of the more common is the realisation that your current debt load is costing you too much by way of interest rates. By obtaining a secured loan, you can refinance that debt load at a lower interest rate with more generous terms.

Other reasons to consider refinancing include:

  • Higher Property Values – If the retail value of your property has increased since you purchased your home, you might be able to get a secured loan financing package based on a higher loan-to-value (LTV) ratio. This would give you more money to use to refinance your existing debt load.
  • Extra Expenses – There are times when homeowners have extra expenses that their current budgets do not have room for. Adding in these extra expenses make managing your current debt load very challenging, indeed. A secured loan against your property changes that.
  • Single Payment – Some homeowners choose to refinance with secured loans because these make it possible to combine multiple monthly payments into a single payment which this easier to manage.

How to Refinance Properly

The actual process of refinancing is no more difficult than obtaining a first mortgage. However, it should not be taken lightly. It is very easy to harm your financial position by not paying close attention to the details. Research is everything when you refinance with secured loans. If you do not know how to refinance properly, find out before you get started.

The first step is to start comparing lenders according to their advertised rates and terms. You can use those rates and terms to get an estimate of your monthly payments by plugging them into a loan calculation tool. Most lenders provide these tools free of charge.

Once you have an idea of which lenders are best for your circumstances, begin contacting them and making an initial inquiry. You will want Information about things such as standard APRs, representative APRs, LTV ratios, loan terms, and all of the additional charges and fees the bank will assess. All of these numbers need to be added up to determine the total cost of borrowing.

Lastly, take this information and compare it to both your monthly budget and what you are currently paying to manage your debt load. If the numbers associated with refinancing are better than the numbers you have now, refinancing is probably a good deal for you. If not, you might want to hold off for now.

If you know how to refinance your debts in a way that improves your monthly budget, you could drastically change your financial future for the better. A refinancing deal could save you lots of money over the long term.

If you don’t want the hassle of researching and learning how best to compare all the lender deals available or just don’t have the time there another great option. Our team of secured loan experts offer their free help and advice to anyone who needs it.

Just call our friendly team who will search our whole of market panel of top high street and specialist lenders to find the most attractive deals that suit your individual criteria. They will help you compare the offers side by side and once you are happy with your choice use their knowledge of lender criteria to create and submit an optimised application ensuring that your case is reviewed by the lender in the most favourable terms.  Our team work for you not the lender and always have your best interests at heart.

Call Us For FREE Expert Advice and the Latest Rates.

We source the best rates from the whole market

  • Borrow up to £2,500,000 Depending on the Equity in Your House.
  • Adjustable Repayment Terms from 3 to 30 years.
  • Secured Loans Can Be Used for Almost any Purpose.
  • Low Interest Rates.
  • Rapid Approval - Low Arrangement Fees.
  • Options for Homeowners with Bad Credit History.
We Will Find You the Best Secured Loan to Suit Your Individual Needs.

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