How to Remortgage to Pay Off Debt

Discover how to remortgage and consolidate debts for budget-friendly monthly payments with guidance from mortgage specialists

Are you looking to consolidate outstanding debt in to your mortgage?

Home Remortgages How To Remortgage To Pay Off Debt
Pete Mugleston

Author: Pete Mugleston

Mortgage Advisor, MD

Nathan Porter

Reviewer: Nathan Porter

Independent Mortgage Advisor

Updated: March 15, 2024

How we reviewed this article:

Our experts continuously monitor changes in the financial space and work closely with qualified mortgage advisors for factual verification.

March 15, 2024

We’ll explain how you can remortgage to consolidate some or all of your debts, what the benefits and disadvantages of this could be and why using the services of a mortgage broker can boost your chances of success.

Can you remortgage to pay off debt?

Yes, it’s possible and actually quite a common reason for remortgaging. As long as you have enough equity in your property and you meet the eligibility requirements of your chosen lender (which can either be your existing lender or a different one), there’s nothing to stop you from remortgaging your home to settle all of your debts. In fact, 90% of lenders in the U.K. allow for this.

The key benefit of doing this is that you have one single payment going out each month, so it’s much easier for people to keep track of their finances. The downside, however, is that tying your short-term debts to a mortgage likely means you’ll pay more interest overall by the end of the term.

How to remortgage to pay off your debt

Your first step should be to speak to a broker who specialises in remortgages as professional advice is the best way to get the most favourable deal.

Make an enquiry with us and we will match you with a remortgage specialist with a track record of helping people release capital to pay off debts.

Your remortgage broker will walk you through the following steps to full application:

  • Calculating your loan-to-value (LTV) – this is the difference between the outstanding balance on your existing mortgage and the current value of your home
  • Working out how much equity you need to release in order to cover the amount required to repay all other existing debts
  • Optimising your credit reports before you apply in order to correct any inaccuracies or outdated information and helping you complete the necessary paperwork

Maximise your chance of approval with a broker who's a specialist in remortgages

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How much more can you borrow?

Each lender sets its own upper limit on how much you can increase your borrowing to pay off other debts.

For around a third of lenders, this is 75% of the value of your home or less. Many major lenders, including some high street banks, cap your borrowing at 80% of the value of your home. Others cap it at 85%. Just a handful of lenders will allow you to borrow more.

So, if your home is currently worth £400,000 and you have equity of £100,000, your current borrowing is £300,000, or 75% of the property value. If you wanted to increase your borrowing by £20,000, to 80% of the property value, you’d have a wide choice of lenders.

If you wanted to increase your borrowing by £40,000, to 85% of the property value, you would have significantly fewer lenders to choose from. Not only that but, if your debt to income ratio is high this will draw more scrutiny from lenders when reviewing your application.

Our remortgage calculator can tell you what your new loan-to-value (LTV) ratio and repayments will be after you’ve remortgaged, with sufficient equity released from your property to consolidate your debts.

Remortgage Calculator

Our remortgage calculator can tell you what your new loan-to-value (LTV) ratio and repayments will be after you've remortgaged, with sufficient equity released from your property to consolidate your debts.

Estimate if exact value is unknown
Estimate if exact value is unknown
Amount must be less than property value
Leave blank if no equity is being released
What will the new term length be after you've refinanced?
Enter the mortgage rate, 5.5% is a typical rate currently but this can vary

New LTV:

After you have remortgaged your new LTV ratio will be and your new mortgage payments will be as indicated below…

New Monthly Repayments:

Get started with an expert broker to find out how much they can help you save on your remortgage.

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Is it a good idea to remortgage to pay off debt?

Lots of people remortgage to pay off their other debts but that doesn’t necessarily mean it’s the right choice for everyone. It’s worth considering all the pros and cons before making a final decision that’s right for you.


  • Having all your finances wrapped neatly into one monthly mortgage repayment
  • Cheaper repayments spread across a longer term
  • Tied to a secure and appreciating asset – so this could, potentially, offset any additional interest you pay


  • Your mortgage is secured on your home, which could be repossessed if you fail to make your monthly repayments
  • Your mortgage probably has a much lower interest rate than your other debts but, because it is a long-term loan, you may pay back a lot more interest in total
  • Exiting your current mortgage deal could incur a large fee if you try to remortgage before the end of a specific fixed-term period. There may be other mortgage fees to pay as part of the process, such as a product fee or valuation fee from your new lender

Lenders and requirements

Most lenders offer remortgages for settling debt, but some have very specific requirements.

For example:

  • TSB allows remortgaging up to 85% of the property value, subject to your credit score. The amount raised for debt repayments cannot be more than 20% of the property value.
  • Santander allows remortgaging up to 85% of the property value. The amount raised for debt settling cannot be more than £50,000.
  • HSBC allows remortgaging up to 80% of the property value. The amount raised for debt settling cannot be more than £50,000.
  • West Brom allows remortgaging up to 80% of the property value. The amount raised for debt repayment cannot be more than £15,000.
  • Harpenden Building Society allows remortgaging up to 80% of the property value. The amount raised for debt repayment cannot be more than £30,000 and the applicant must have a satisfactory repayment history.

All of the above information was accurate at the time of writing but keep in mind that mortgage lenders are constantly updating their eligibility criteria – particularly during periods of economic instability – so, these details can be subject to change at any time.

Which lenders have you already tried?

Select the tiles below to continue:


Remortgaging with new debt

If you are looking to remortgage your home for another reason (besides debt repayments) but you have new debts since you were first approved for a mortgage, be aware that these can affect your remortgage application.

Many lenders will look at your debt-to-income ratio (i.e. the percentage of your monthly income that you spend on debt repayments) as part of their affordability assessment. If your debt-to-income ratio is much higher than it was before, this can lead to having your mortgage application declined.

However, this is not always the case, and even if it does happen, there are likely to be other lenders who will accept your application. Each lender sets its own eligibility criteria for debts, so you’ll need to find the lender that best suits applicants in your situation. This is easiest with the help of a broker.

Key takeaways

  • 01

    It can be done

    Refinancing debt with a remortgage can be a great way to reduce your monthly outgoings to a more manageable level and help you make your debt more manageable. It's a common query the brokers we work with deal with on a daily basis, and with so many options out there, there's likely to be one right for you.
  • 02

    A broker can help you get it done right

    The right mortgage broker can help you make an informed decision about the best way to use remortgaging as a way to pay off debt, and find a great deal.
  • 03

    Understand your eligibility

    To pass the credit assessment you’ll need to be able to prove you can afford the new loan. Every lender uses different methods to assess your credit scoring; some are strict and demand you have a clean credit history while others will be more flexible
  • 04

    Find the right mortgage lender

    Choosing the right remortgage lender is absolutely vital. The best way to find out whether sticking with your current lender is in your best interest is to speak to a mortgage broker.

Get matched with a remortgage specialist

Lender requirements for remortgaging to consolidate debts can be intricate and your broker will need to know all of them. So, it’s best to speak to someone who specialises in this area of the market.

If you’d like advice from a debt repayment remortgage specialist, we can connect you to one for a free, no-obligation chat. Simply use our broker-matching service by calling 0808 189 2301 or enquiring online.

Maximise your chance of approval with a broker who's a specialist in remortgages

Get Started Phone Icon 0808 189 2301


Yes. You’ll need to find the right lender, though, as not all lenders accept remortgage applications for Shared Ownership properties for the purposes of debt repayment.

It may be best to check with your housing association first. Even if a lender allows for this, they may not.

About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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