Mortgage free or not

Worried_of_wakefield

4 more payments to go! is there any reason why I should keep a mortgage going? tax, credit? or any other reason

sKiTz-0

Not that I know of. I think it used to be the case that the bank kept your house deeds until the mortgage was paid off, but believe as it is all electronic nowadays that is irrelevant.

edinburgher

Well, there's no tax benefit to having a mortgage that I can think of (unless it's a BTL).

Beckyy

One reason people choose to keep it is because it's a source of low interest debt. For example if you wanted to fit a new expensive kitchen, rather than taking out finance you could ask for your mortgage to be increased which would be a much lower interest rate than other loans if your bank were to agree.

Flugelhorn

I agree with Beckyy - I have an offset mortgage, most paid off but have left the last 50K fully offset. Higher rate tax payer so not much interest if I out the money anywhere else. Gives me the option to borrow more money if I need it.

edinburgher

Can you remortgage a property where you own it outright? Or would that not be an option?

Flugelhorn

I remortgaged a property I owned outright in order to buy another property before selling the first one - wasn't any problem but then it was about 2007 ....

Beckyy

You can remortgage an unencumbered property to release equity, but some lenders may only agree if the funds are for a certain purpose. I recently did this with a BTL and certain lenders were fussy about what the funds were used for (ie - home improvements or purchasing another BTL ok, but personal use not according to the IFA). I managed to find one without a problem myself (virgin), and I don't think you'd have too much trouble to if you wanted to re-mortgage.