How a Debt Consolidation Mortgage Helped One Client Reduce Monthly Costs and Regain Financial Control

Client Overview

A woman in her late 50s working in a professional role in the South of England faced an expiring mortgage deal and mounting unsecured debts totaling over £85,000. With retirement on the horizon in the next 15–20 years, she sought to simplify her finances, secure lower monthly outgoings, and maintain long-term affordability.

The Challenge: Consolidating Debt and Securing Mortgage Stability

The client’s existing 14-year mortgage with Halifax was ending, and unfortunately, her lender wouldn’t offer a new mortgage inclusive of additional borrowing for debt consolidation past age 70. With rising monthly repayments on multiple unsecured debts and limited flexibility within her current setup, she needed a mortgage lender willing to:

• Allow consolidation of debts into a new mortgage
• Provide long-term fixed-rate stability
• Offer flexibility for overpayments
• Fit within a comfortable monthly budget of £1,600–£1,650

She also required a solution that would not penalize her for early repayment through regular overpayments or potential downsizing before retirement.

The Solution: Fixed-Rate Debt Consolidation Mortgage with NatWest

After reviewing options across the mortgage market, the chosen solution was a debt consolidation remortgage with NatWest Markets Plc with the following key features:

• Fixed Interest Rate: 3.93% fixed until December 2030, reducing future remortgage risk.
• Loan Amount: £288,444 spread over 22 years, allowing reduced monthly payments.
• Monthly Repayment: £1,639.63 during the fixed term, comfortably within budget.
• Debt Consolidated: £85,562 of unsecured debt combined into the mortgage.
• Overpayment Flexibility: Up to 20% a year with no penalties—ideal for paying down the loan faster.

Other lenders like Nationwide and Santander offered lower rates but restricted overpayments to 10% annually. NatWest’s higher flexibility aligned perfectly with the client’s strategy to reduce the mortgage term using extra income throughout the year.

Results: Financial Stability and Flexibility for the Future

This remortgage to consolidate debt transformed the client’s financial standing:

• Debt Consolidation Simplified: Rolled multiple debts into one manageable repayment.
• Improved Affordability: Replaced variable high-interest repayments with a single, fixed monthly cost.
• Overpayment Option: 20% yearly allowance enables term reduction plans without penalty.
• No Immediate Repayment Risk: The client avoided early repayment charges on the existing mortgage by timing the new agreement carefully.

Client Feedback: “I wanted a fixed deal that gave me breathing space and flexibility to overpay. I’m so glad I found a broker who listened to what mattered to me most.”

Frequently Asked Questions

Can you remortgage to consolidate debt?

Yes. If you have equity in your home and meet the lender’s criteria, you can remortgage to consolidate unsecured debts—often resulting in lower monthly payments and simplified finances.

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

Savings vary by case. In this scenario, the client reduced her payments to £1,639/month from over £2,200 with her old arrangement, thanks to the extended term and fixed interest rate.

Does remortgaging affect my credit score?

Initially, your score may dip due to a credit check, but over time, making regular payments and consolidating debt responsibly can boost your credit profile.

What documents are required for a remortgage application?

You typically need proof of income (payslips or tax returns), ID, address documentation, and the most recent mortgage statement.

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

Yes, but only within set limits. NatWest allows up to 20% of the balance annually without penalty. Exceeding that can trigger early repayment charges, which decrease annually over the fixed-rate term.

Take Control of Your Financial Future Today

If you’re struggling with unsecured debts or coming to the end of a fixed mortgage deal and want to regain control of your finances, a debt consolidation mortgage may be the perfect solution. Our expert advisers can help you:

• Find the best remortgage deals for debt consolidation
• Understand your affordability and repayment options
• Secure a flexible mortgage tailored to your long-term goals

Let us help you reduce stress and take the next step toward financial freedom. Contact us today for a free consultation with one of our brokers.