How a Debt Consolidation Mortgage Helped One Couple Secure Financial Stability and Lower Monthly Payments

Customer Overview

A married couple in their early 40s—one working in the public sector and the other in a private firm—based in southern England, were approaching the end of their fixed-rate mortgage deal. With a secured loan and rising monthly obligations, they were looking for a streamlined financial solution to reduce their debt burden and simplify repayments through a NatWest debt consolidation mortgage.

The Challenge: Managing a Secured Loan and Rising Costs

The couple initially held a mortgage with Accord Mortgages but were unable to secure additional funding to repay a secured loan through their current lender. The obstacle? Accord wouldn’t include legal services needed to close a secured loan under a further advance, and the couple needed a new arrangement that wouldn’t treat the consolidation as pure debt restructuring.

At the same time, they aimed to:

• Secure a new 5-year fixed-rate mortgage deal
• Consolidate £27,604 of secured debt
• Raise £3,489 for essential home furnishings
• Keep monthly payments manageable within a 23-year mortgage term

The Solution: A Debt Consolidation Remortgage with NatWest

After carefully reviewing their goals and financial profile, a mortgage adviser recommended a NatWest debt consolidation mortgage. This lender was selected specifically because it:

• Allows consolidation without reducing the Loan-to-Value (LTV) below 90%
• Provides enhanced affordability calculations
• Offers favourable rates on 5-year fixed terms

The couple remortgaged with NatWest at a fixed rate of 4.36% until December 2030, consolidating their existing mortgage, secured loan, and additional home improvement funds into one single mortgage under the NatWest debt consolidation mortgage plan.

Key Mortgage Terms:

• Loan Amount: £182,700
• Term: 23 years
• Initial Monthly Payment: £1,055.42
• Capital Raised for Debt & Furniture: £31,093
• Product Fee: Added to the mortgage for affordability

Why This Solution Worked

The NatWest product offered a balance between affordability, flexibility, and rate security. With the option to consolidate a secured loan without it being categorised as debt consolidation by the lender, the couple was able to retain higher borrowing capabilities. Overpayment allowances and porting features added further flexibility. A NatWest debt consolidation mortgage was key to achieving their objectives.

Results: Long-Term Savings, Simplicity, and Financial Confidence

By consolidating the secured loan into their mortgage, the couple streamlined their finances with a single monthly payment and protected themselves against rate volatility for the next five years. Although consolidating increased the overall interest payable over time (£51,619.48 for the consolidated debt), it substantially reduced their monthly burden and complexity of managing multiple repayments.

Client Testimonial:
“The new deal simplified everything. One fixed payment, no juggling between our mortgage and the secured loan, and we even had enough flexibility to fund some needed household upgrades. Big thanks to our adviser for finding a lender that actually worked in our favour.”

FAQs About Debt Consolidation Mortgages

Can you remortgage to consolidate debt?

Yes. Remortgaging to consolidate debt allows you to combine existing debts, such as secured or unsecured loans, into your mortgage—often reducing monthly payments and simplifying management. Opting for a NatWest debt consolidation mortgage can be an effective choice.

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

While savings vary based on rates and balances, many customers consolidate multiple high-interest debts into one lower-interest mortgage payment, often saving hundreds per month. In this case, the customers achieved a fixed monthly mortgage payment of £1,055.42, which was manageable within their budget.

Will remortgaging affect my credit score?

Initially, your credit score may see a minor dip due to a hard credit check. However, over time, making consistent payments on your new mortgage can positively impact your credit history.

What documents are required for a remortgage application?

You’ll typically need proof of income (payslips or accounts), ID, proof of existing mortgage, property valuation, and statements for any debts you’re consolidating. Your broker will guide you through exactly what’s needed.

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

Not entirely. Fixed-rate mortgages often have early repayment charges (ERCs). In this case, the charges decrease each year, starting at 4.5% and dropping to 1% in the final year. These charges apply only during the fixed-rate period (until Dec 2030 for this loan).

Take Control of Your Finances Today

If you’re coming to the end of a fixed mortgage or struggling with managing multiple debts, a debt consolidation remortgage could be the answer. At Deal Direct, we work across the whole market to find the right solution for your unique needs.

Let us help you simplify, save, and move forward financially. Contact us for your free consultation today.