So, what choices do you have? One way in which you might able to significantly cut the amount of cash you have to part with each month is by looking at interest only remortgage deals.
With these offers you pay off the interest on your mortgage loan - the amount you borrowed in the first place to buy your house - which means you pay less each month compared to a repayment mortgage.
Of course, if you are thinking about switching to this type of deal and are making an interest only remortgage comparison, there are some important things to think about.
Comparing the best interest only remortgages
When you compare interest only remortgages there are important points to consider which vary from lender to lender. Of course there's the initial interest rate, but beyond that you need to consider:
Whether you want a fixed or variable rate
How much you need to borrow
How much could you be charged as a fee for the mortgage you want
How long you want to rate to last for
How long your full mortgage term will need to be
What charges you might face for wanting to remortgage again
There's a lot to get your head around when it comes to finding the best deal for your circumstances, which is why we have a number of guides that can help, including Should you get a long or short term mortgage? and Should you get an interest only or repayment mortgage?
After you've found a deal that suits your needs, you need to allow a good deal of time for the switch the take place.
You will need a solicitor to sort out the details between your current provider and the new one and orchestrate your application.
This will involve getting your home valued and moving money between the lenders, so again leave plenty of time for these things to happen and make sure you have decided and agreed on a date for your new deal to progress.
Remortgage interest only deals: good for the short term
If you are coming to the end of your current mortgage deal and want to switch before the standard variable rate (SVR) kicks in, it's certainly worth having a look around.
However if, for the time being, money is tight and you need a stopgap solution that will allow you to keep your home but pay less each month, an interest only remortgage rate could be a good temporary measure.
Maybe you or your partner has lost a job or you want to put more of your income towards clearing other debt for a while - whatever the reason, if you have less cash to put towards repaying your mortgage, an interest only deal could drastically cut how much you need to pay.
Have a long term payment plan
While a remortgage interest only deal could well give you a helping hand in the meantime, you need to be aware that while you're on one, you won't be paying any of your actual mortgage loan off.
This could leave you unstuck if you reach the end of your term agreement and still have a load of debt to repay.
This is why it might be worth moving to a repayment mortgage, which will see you chip away at how much you owe overall.
This isn't the only option though; you may prefer to put your money in ISAs, stocks and shares and buy to let property if you want to save it or make it work harder.
It's worth having a plan in place so that you won't get caught out - take the time to check that your finances are in good shape and that you can afford to remortgage.
Our guide Should you get an interest only or repayment mortgage?, covers in greater detail the benefit of comparing and moving to a different mortgage.
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