Remortgage to Consolidate Debt: How One Couple Regained Financial Control

Customer Overview

A married couple in their late 40s—a self-employed contractor and a part-time healthcare worker—from the West Midlands, recently sought help to regain control over their growing debts. After several years of reduced income and personal hardships, their finances became increasingly difficult to manage, leading them to explore solutions like a debt consolidation remortgage.

The Challenge: Mounting Debt and Diminished Financial Stability

The couple faced severe financial strain due to a sharp drop in income. The wife experienced a period of redundancy and later had to shift to part-time work to care for their mentally unwell daughter. Living on a single income for six months caused them to rely heavily on credit cards and short-term loans to cover day-to-day living costs.

Despite keeping up with minimum payments, the couple’s debt—spread across high-interest credit cards and unsecured loans—totalled £35,326.25. These payments were mostly covering interest, not reducing the principal, making it nearly impossible to improve their financial standing.

Additionally, having a high number of active credit commitments was negatively affecting their credit score, potentially impacting their ability to remortgage when their fixed rate ends in 2027.

The Solution: A Debt Consolidation Remortgage

To streamline their monthly commitments and reduce financial stress, the couple chose to consolidate all their unsecured debts into a secured loan through a debt consolidation remortgage. With expert guidance, they refinanced their property, rolling 13 separate high-interest debts into a single, manageable mortgage payment.

This strategy allowed them to:

• End the cycle of paying only interest on high-rate credit cards (some up to 49%)
• Eliminate the risk of missed or bounced payments
• Free up approximately £669.39 per month in disposable income
• Fund a modest home improvement project by converting their garage

While consolidating debt into the mortgage through a remortgage option would result in a longer repayment period—and higher total interest paid over time (£96,440.66)—the improved monthly cash flow and reduced mental strain made it a worthwhile decision for their situation.

Meaningful Results and Financial Peace of Mind

By consolidating their debts using a debt consolidation remortgage, the couple moved from a cyclical financial struggle to a stable monthly repayment plan—reducing their monthly outgoings and increasing their financial breathing room. Crucially, they will now be paying down the principal and not just the interest, which gives them a defined end date for clearing their debt.

Testimonial: “Getting everything into one payment was a massive weight off our shoulders. We finally feel like we can see the light at the end of the tunnel.”

FAQs

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

In this case study, the couple saved approximately £669.39/month by consolidating 13 debts into one secured loan, dramatically reducing interest payments and eliminating multiple monthly repayments with their debt consolidation remortgage.

Can you remortgage to fund home improvements?

Yes. Part of the couple’s consolidation remortgage included raising surplus funds to convert their garage. This is a common approach when homeowners include home improvements as part of a debt consolidation remortgage.

Does remortgaging affect my credit score?

Initially, applying for a remortgage might temporarily lower your score due to the credit check process. However, if used to pay off high-interest debts and reduce outstanding balances, it often improves your score over time.

What documents are required for a remortgage application?

Typical documents include proof of income, current mortgage statements, details of existing debts, bank statements, and credit reports. Your broker will guide you through the specific requirements.

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

This depends on your lender and product. Many fixed-rate deals include early repayment charges (ERCs). Always review your Key Facts Illustration (KFI) or speak with an advisor before making overpayments or switching deals.

Ready to Take Control of Your Debts?

If you’re struggling with high-interest credit cards or juggling multiple payments each month, a debt consolidation mortgage could offer the structure and savings you need. Speak to one of our expert advisors today to explore your options and calculate your potential savings using our remortgage calculator.

Contact us now for a free initial consultation and explore the best way forward for you and your family. Let us help you build toward financial freedom and peace of mind.