Can I Remortgage to Pay Off Debt?

Last updated: 11 September 2026

How remortgaging to pay off debt works

A remortgage to pay off debt replaces your existing mortgage with a new, larger one, usually with a new lender, though sometimes with your current one. The difference between what you owed on your old mortgage and the amount of the new one is released as cash on completion, and your solicitor uses that money to clear your credit cards, loans or overdrafts directly, rather than paying it into your account for you to distribute yourself.

This is a different mechanism from a secured loan, also called a homeowner loan or second charge mortgage, which is a separate borrowing arrangement that sits behind your mortgage rather than replacing it. With a remortgage, you end up with one mortgage and one monthly payment. With a secured loan, you keep your existing mortgage as it is and take on a second, additional payment alongside it.

Because the new mortgage pays off the old one in full, your original lender's rate, deal and terms fall away entirely, replaced by whatever you agree with the new lender. That's a significant decision in its own right, separate from the debt consolidation question, which is one reason a broker will always look at your existing deal before recommending this route.

What determines whether you can do it

Three things mainly decide whether remortgaging to pay off debt is realistic for you: equity, affordability and your existing deal.

Equity is your property's value minus what you still owe on your mortgage. Lenders will only let you borrow up to a certain loan-to-value, typically 80% to 85% for this kind of remortgage, so the more equity you have, the more room there is to raise money for debt consolidation.

Affordability is assessed the same way as any mortgage application: your income, your outgoings, and how the new, larger monthly payment compares to what you can comfortably manage. Lenders will usually want to see that your current mortgage payments are up to date, and will factor in the debts you're clearing as part of the wider picture.

Your existing deal matters too. If you're on a variable rate, or your fixed or tracked deal has already ended, there's often nothing to lose by moving. If you're still mid-way through a fixed rate, though, leaving early usually triggers an early repayment charge, which can run into thousands of pounds depending on how much time is left on the deal.

What it could look like in practice

Here's a worked example using fixed, illustrative figures, not a live quote, to show how the monthly numbers can change.

	Amount
Current monthly payments (credit cards at 24.9% and a personal loan at 12.9%)	£520/month
New mortgage payment on the extra £22,000 borrowed (5.4% over 20 years)	£150/month
Total repayable on the extra £22,000 over the 20-year term	£36,000

The monthly outgoing drops sharply in this example, but the total repaid on that £22,000 over 20 years is considerably more than the £22,000 originally borrowed, because it's being repaid over a much longer period than the original credit card or loan agreements would have run for. A broker will always set this out clearly before you decide anything.

Early repayment charges: the main reason this doesn't suit everyone

An early repayment charge is a fee your current lender charges if you leave a fixed or tracked deal before it ends, usually calculated as a percentage of your remaining mortgage balance. It can easily run into several thousand pounds on a typical mortgage, and it's charged on top of any legal and valuation fees for the new mortgage.

If your existing deal has a while left to run, this charge can outweigh any benefit of moving your debts across, particularly if the amount of debt you're clearing is relatively small. In that situation, a secured loan or a further advance, both of which leave your existing mortgage deal untouched, are usually worth comparing before you commit to a full remortgage.

If your deal is ending within the next few months, though, or has already ended and moved onto your lender's standard variable rate, there's often little or nothing to lose by remortgaging now rather than waiting.

Remortgage, further advance or second charge mortgage: which fits

Remortgaging isn't the only way to use your property to consolidate debt. A further advance means borrowing more from your existing lender without switching, which can be simpler if your current lender allows it for this purpose. A second charge mortgage, the formal name for a secured loan or homeowner loan, is a separate loan from a different lender that sits behind your mortgage rather than replacing it, leaving your existing rate completely untouched.

Each route suits different circumstances. Remortgaging tends to make most sense when your current deal has ended or is close to ending, and when the new lender offers better overall value than staying put. A broker who can compare all three routes side by side, rather than offering just one, is the quickest way to find out which applies to you. Our further advance hub and second charge mortgage hub cover the other two options in more detail.

How the process works

The process usually starts with a broker looking at your property value, your existing mortgage balance, your income and the debts you want to clear, then comparing lenders who'll offer the loan-to-value and rate you need. Checking your options this way will not affect your credit score.

If you go ahead, you'll submit a full application, including proof of income, a property valuation and a formal offer from the new lender. Your solicitor then handles the legal side, including paying off your old mortgage and your other debts directly from the new mortgage funds on completion, so you don't need to manage several repayments yourself during the switch. A straightforward remortgage typically completes within four to eight weeks, though this varies by lender.