How a Debt Consolidation Remortgage Helped One Couple Regain Financial Control

Customer Overview

A professional couple in their early 50s from the south of England were facing financial challenges due to being on a high variable interest-only mortgage. With a desire for financial stability and long-term repayment certainty, they sought guidance to remortgage and consolidate their debts, an approach that proved effective with the Pepper debt consolidation remortgage.

The Customer’s Challenges

• Trapped on a high variable interest-only mortgage with no repayment plan.
• A need to switch to a repayment mortgage with fixed monthly costs.
• An existing secured loan and multiple credit debts totaling over £31,000.
• Lender limitations from the current provider, who couldn’t facilitate the consolidation due to solicitor requirements.
• Affordability constraints restricting their mortgage term options.

Our Tailored Debt Consolidation Remortgage Solution

To help this couple achieve financial security and simplify their repayments, we structured a strategic debt consolidation remortgage using a specialist lender. Here’s how we supported their goals:

Key Elements of the Remortgage

• Lender: Pepper (UK) Limited, known for accommodating complex affordability cases.
• Rate: 5-year fixed rate at 6.69% for monthly stability.
• Loan Amount: £130,500 over 21 years on a repayment basis.
• Debt Consolidated: £31,199.67, including a secured loan with legal fees covered.
• No Product Fees: Chosen for cost-efficiency and long-term affordability.

Why This Approach Was Right

• Ability to consolidate debts into mortgage repayments at a lower monthly cost.
• Secured a capital & interest repayment basis, ensuring the home will be fully paid off by the end of the term.
• 5-year fixed rate provided certainty and manageable payments close to £900/month.
• Selected lender did not apply strict debt-to-income or credit commitment rules, which helped with approval through a Pepper debt consolidation remortgage.

Outcome and Financial Benefits

• Replaced their interest-only loan with a repayment mortgage, ensuring property ownership at term-end.
• Streamlined all debts into one affordable repayment, making budgeting easier and more predictable.
• Avoided high arrangement fees and benefited from free legal and valuation support.
• Achieved a manageable monthly payment of £964.28 during the fixed term.

“We never thought we could move to a full repayment mortgage until we spoke to Deal Direct. They listened to everything and found a lender who would consider our full situation—not just our credit record. We’re finally on track to pay off our home and sleep better at night.” — Anonymous Customer

FAQs: Remortgaging and Debt Consolidation

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

This varies, but for this couple, consolidating £31,199.67 into their mortgage allowed them to reduce their multiple high-interest repayments into a single monthly mortgage payment around £964.28—significantly improving cash flow with the Pepper debt consolidation approach. However, because the loan is repaid over a longer term, total interest paid over time may increase.

Can you remortgage to fund home improvements or for a financial buffer?

Yes. In this case, the couple added an extra £284.33 as a buffer for any completion shortfalls. You can raise capital via remortgage for various reasons including renovations, provided it’s aligned with lender criteria such as those of Pepper.

Does remortgaging affect my credit score?

Applying for a new mortgage generates hard credit checks, which could cause a slight temporary dip in your score. However, consolidating debts and improving your debt-to-income ratio may positively impact your score over time.

What documents are required for a remortgage application?

Generally, you’ll need proof of income (payslips/self-employment accounts), bank statements, ID, credit reports, and details of current debts or mortgage statements.

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

Most fixed-rate mortgages come with early repayment charges (ERCs). For this customer, the ERC was 4% in the first year, reducing to 2% in year five. Always review your ESIS for full details before repaying early.

Ready to Consolidate Debt and Regain Financial Peace of Mind?

At Deal Direct, we specialise in debt consolidation mortgages and finding lenders willing to look beyond credit scores to see your full financial picture. Whether you’re seeking a remortgage to consolidate debt or simply want fixed repayments for peace of mind, we’re here to help, even with something as specific as a Pepper debt consolidation remortgage.

Contact us today to speak with our expert mortgage advisors and explore the best options for your situation.