One of the main reasons many people decide to turn to remortgage plans is for debt consolidation. And it is not difficult to figure out exactly why in fact, you could probably guess. After all, a remortgage allows you to get a new mortgage at a new lender with a new, much lower interest rate. So why would not someone want to take advantage of such a prospect?
For an example of an individual who could make great use of a remortgage, see Angies story below. Though the exact players are fictitious, the scenario is repeated throughout the globe day after day.
Angies Story
Angie is a divorced single mother of two teens who works two jobs, but still has trouble paying the mortgage and all her other bills. Though she received her house as part of her bitter divorce settlement, she sometimes regrets the decision not to move or sell the place. However, at this point, shed rather stay where she is so her children wont have to change schools.
Her credit card bills have been mounting, and though shes just able to pay off the interest each month, shes never been able to touch the principle balance. Though her credit history isnt that bad yet it was a little damaged during the divorce, shes worried that, before long, shell end up skipping payments and ruining her credit report for the long term.
So what is Angie to do?
For people in Angies position and at Angies stage of life, a remortgage can be an absolute saving grace. And a remortgage just makes a great deal of sense. For instance, in Angies case, a remortgage will most likely allow her to:
Consolidate her bills into one easy to make lump sum. Yes, she will still have to pay off the principle balances on her credit cards, but her overall payment will be smaller than before. This will allow her family to feel less as though bankruptcy could come at any time.
Become a better money manager for her family. A remortgage may even save her enough to be able to splurge now and then on her children. And her children will likely becoming better managers of their own finances, both now and later in life.
Start working on building her cache of money by herself. Many divorced, separated, and widowed women find themselves in the position to start making financial decisions that were previously made by the so called man of the house. A remortgage will enable her to start constructing her individual credit and will give her a much needed sense of self esteem.
Ironically, many gals like Angie do not even know about remortgage; thus, they do not turn to remortgage during times of fiscal crises. Hence, if you know someone in Angies position who could benefit from switching lenders and obtaining a lower interest rate via a remortgage, do not delay in telling them about this often used financial planning move. It could just give them the fiscal breathing room they need to start feeling healthier money wise.
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