Debt Consolidation Remortgage: How One UK Couple Reduced Monthly Outgoings by Over £1,000

Customer Overview

A married couple in their mid-40s based in the UK approached us feeling financially stretched. Both were in full-time employment and had kept up with their commitments, but rising living costs and multiple high-interest credit accounts were putting pressure on their monthly budget. By considering debt consolidation remortgage, they hoped to ease this financial strain.

Their main objective was clear: reduce monthly outgoings, increase net disposable income, and relieve financial pressure.

The Challenge: Over £104,000 in Unsecured and Secured Debts

Over time, the couple had accumulated £104,504 across several credit cards, a personal loan, mail order accounts, and a secured loan. Most of the borrowing had been used for home improvements. Ultimately, they wanted a remortgage for debt consolidation to simplify payments.

The key issues were:

• Credit cards charging 27%–30% interest
• A large secured loan with a high monthly repayment
• Total monthly debt repayments of £1,863
• Reduced disposable income due to multiple high payments
• Concern about managing finances as the cost of living increased

Although they had not missed payments, they felt they were “spreading themselves a little thin” and wanted breathing space each month.

Understanding the True Cost of Debt

If the debts remained as they were, the projected total repayment across all accounts would have been approximately £164,823.

By choosing a debt consolidation mortgage, the total repayment over the full mortgage term would be around £154,667, meaning a projected saving of £10,157.08 — assuming the mortgage runs full term and minimum payments would otherwise have been made.

However, it was clearly explained that:

• They would repay approximately £1.48 for every £1 borrowed
• The debt would now be secured against their home
• Interest would be paid over a longer period
• Long-term costs can be higher when extending short-term debts into a mortgage term

As with all cases where debt consolidation is achieved via remortgage, the benefits needed to be weighed against the long-term implications.

The Solution: Remortgage to Clear Debt and Improve Cash Flow

After completing a full income and expenditure assessment, we recommended a structured remortgage to clear debt and improve monthly affordability. Choosing a debt consolidation remortgage allowed the couple to streamline their repayment process.

What the Remortgage Achieved

• Consolidated £104,504 of debts into the mortgage
• Reduced high-interest credit cards (27%–30%) to a much lower mortgage rate
• Cleared the large secured loan with a £903 monthly repayment
• Simplified multiple payments into one monthly mortgage payment
• Increased monthly disposable income by approximately £1,024.17

Importantly, the couple chose to leave a small number of lower balances and hire purchase agreements outstanding, using their improved cash flow to clear those separately. Because the debt consolidation remortgage covered the largest debts, they could focus on smaller commitments.

Why Not a Secured Loan?

In some cases, clients consider secured loans for bad credit or additional borrowing instead of remortgaging. However, in this situation:

• A secured loan would have added another large monthly commitment
• Interest rates would likely have been higher than the new mortgage rate
• It would not have simplified their finances to the same degree

The remortgage was the most prudent and sustainable solution for their circumstances. Moreover, debt consolidation through a remortgage offered more flexible repayment terms for the couple.

The Results: Immediate Relief and Long-Term Structure

While the long-term cost of borrowing must always be considered carefully, the short- to medium-term impact was significant: For many, debt consolidation remortgage can lead to immediate improvements in monthly finances.

• Over £1,000 extra disposable income per month
• Reduced financial stress
• No missed payments
• Greater monthly stability
• Ability to budget and plan ahead

As one applicant explained:

“We’ve managed up to now, but with everything getting more expensive, we just wanted to stop worrying about our debts and have more breathing space each month.”

Because most of the borrowing was for completed home improvements, they confirmed the debts were unlikely to reoccur.

Important Considerations Before You Remortgage to Pay Off Debt

If you are wondering, can you remortgage to consolidate debt? — the answer is yes, but it must be carefully assessed. Debt consolidation remortgage should always be considered alongside professional advice.

You should consider:

• How long is left on your current debts?
• Are any balances under £1,000 or due to finish within 2 years?
• Are you consolidating 0% credit card balances?
• Will you avoid building up new credit after consolidation?

Using a remortgage calculator can help estimate repayments, but professional advice ensures you understand the full long-term cost.

Frequently Asked Questions

How much can I save monthly by consolidating credit card debts into a mortgage?

In this case, the clients improved their disposable income by approximately £1,024 per month. Savings vary depending on interest rates, loan sizes, and remaining terms. If undertaking debt consolidation remortgage, your savings could be substantial depending on your circumstances.

Can you remortgage to fund home improvements?

Yes. Many homeowners use a remortgage either to fund improvements or to consolidate debts built up from renovation projects.

Does remortgaging affect my credit score?

A remortgage application involves a credit check, which may cause a small temporary impact. However, consolidating debt and reducing credit utilisation can improve your profile over time if managed well. The debt consolidation remortgage itself often has a positive impact on your score long-term, if handled correctly.

What documents are required for a remortgage application?

Typically, you’ll need:

• Proof of income (payslips or tax calculations)
• Bank statements
• Details of outstanding debts
• Proof of identity and address

Can I repay a fixed-rate mortgage early without penalties?

Many fixed-rate mortgages include early repayment charges during the fixed period. Always check your mortgage offer or speak to an adviser before making lump-sum payments.

Is a Debt Consolidation Mortgage Right for You?

A mortgage to pay off debt can provide vital breathing space and simplify your finances. However, it also means securing previously unsecured debts against your home and potentially paying interest over a longer period. When considering debt consolidation remortgage, weigh the risks carefully before proceeding.

Every case should be individually assessed to ensure it is the right solution — not just the quickest fix.

Take the First Step Toward Financial Freedom

If rising credit card balances and loan repayments are putting pressure on your household finances, a remortgage to consolidate debt could help you regain control. Exploring debt consolidation remortgage is one way to take back control of your budget and spending.

Speak to our expert advisers today to explore your options and see how much you could save each month.