Are you confused between re-mortgage and personal loan, and which one will suit your needs as a newcomer? Then this handy guide will help you to choose one that will suit your financial requirements. However, end of the day, every homeowner will be left with a choice whether you have to go for a re-mortgage or personal loan.
So that is why we bring this article for you with every bit of knowledge about re-mortgages and personal loans. Moreover, we will show some pros and cons of both to help you choose the better one. So if you are a newcomer mortgage Richmond Hill, read this article very carefully.
Re-mortgaging is a thing that will allow you to transfer your current mortgage to a different and new product.
However, it will be your choice that whether you want to stay in your existing mortgage or with both a new one and the current one. Moreover, re-mortgaging will allow you to move to a cheaper mortgage rate.
Advantages of re-mortgaging
- If your property rate is getting higher, re-mortgaging will help you access the cash efficiently and bring down your monthly costs. However, the amount will add to your loan amount’s overall value, but you can pay it on time. Moreover, making monthly payments while re-mortgaging is cheaper than a personal loan. However, if your new deal ends, you can re-mortgage again or pay it with overpayments.
- Re-mortgaging will help you to manage your finances if you have different financial status or credit cards. However, it will not increase your overall mortgage amount. So if you are facing difficulty in managing your finances, re-mortgaging is one of the best options.
- Re-mortgaging will let you access the large sum of amount for an unexpected debt. If you decide to purchase a new house as a newcomer mortgage Richmond Hill and you can not secure a loan, re-mortgaging is a better option to get the cash.
Disadvantages of Re-mortgaging
- Re-mortgaging can increase the overall repayment over a long period. End of the day, you can pay off your debts as your monthly repayment is lower. However, re-mortgaging can be ten times more expensive than taking a short-term personal loan.
- If you have a small equity amount of equity, you will be uneasy about getting a re-mortgage.
- If you want to leave before ending a deal, you have to pay extra charges to arrange a new product. However, it can overbalance the low-priced deal.
- If you are deciding to move, it can be expensive to get a new deal.
- If you are re-mortgaging to pay off your debts, the risk of losing your house will increase.
If you decide to purchase a new house, taking a personal loan will help you settle your debts and pay for a significant event. However, accessing a personal loan application will depend on your credit report.
If your credit report is perfect, you will get the best results from your mortgage broker. Moreover, a personal loan will not require any arrangement fees.
Advantages of personal loan
- The process of getting a personal loan is a bit quicker than re-mortgaging. However, you do not have to wait like in re-mortgaging.
- You can save 25 years of interest payments on your loan because monthly repayment will be higher in a personal loan.
- Getting a personal loan will not put your property at risk. If you missed out on any loan payment, it would only affect your credit score.
Disadvantages of personal loan
- If you struggle to do the monthly repayment, getting a personal loan is not a better choice.
- If you require a large amount of equity, getting a personal loan is not a better choice.
- Missing any monthly payment can harm your credit score.
We hope that this article has clear out your doubts related to re-mortgage and personal loans. However, as a newcomer mortgage Richmond Hill, you have to make a better decision that suits your financial requirements and needs. Moreover, re-mortgaging will depend on your income and getting a personal loan will depend on your credit score.