When you change from your mortgage to a different deal, and leave your current lender to join another without changing the property, you’re remortgaging.
People do this for different reasons, but mostly because it’s cheaper. Let’s say the time period for the discounted mortgage rate has finished with the existing lender, and people might find a better deal with a different lender. Consolidation of debts is also one reason for remortgaging.
Remortgaging, however, isn’t always the best option you have. If you think you’re saving money by signing up on lower interest rates, you’re missing out on the money it costs to set up entirely new mortgages. Going from unsecured to secured debt is also not a long-term option—at least it isn’t a wise one.
Before switching mortgages, always consider the repayment period overall. If you’re paying less on a monthly basis but will have to pay for a longer time, it can actually be a greater amount than the current deal.
Alternatively, try to broker a new deal with your existing lender. This could be both cheaper and more beneficial in the long-term. Most lenders are okay with you changing your mortgage deals, even if you want to do it frequently.
Short term debts might sound appealing, but they usually come with increased terms for repayment. The overall amount to be paid takes a hit and you might even be looking at earlier repayments and penalties for leaving your existing lender.