TL;DR Yes, you can remortgage to pay off debt.
The process involves replacing your current mortgage with a larger one and using the extra funds to clear what you owe, a process known as a debt consolidation remortgage or capital raising remortgage.
This works best when you have sufficient equity in your home and your unsecured debts carry a higher interest rate than a mortgage. Lenders will check your credit history, income, and loan-to-value ratio before agreeing. Speaking to a mortgage broker first will save you time and help you find the right deal.
Carrying multiple debts is draining.
Credit card bills, personal loans, car finance, each one takes a slice of your monthly income. According to the Money Charity’s May 2025 Money Statistics, the average UK household carries £2,579 in credit card debt alone, and total outstanding credit card debt across the UK reached £73.2 billion in March 2025.
If you own your home and have built up equity, you may be wondering whether a remortgage could give you a way to bring everything under control.
The short answer is yes.
A remortgage can be used to pay off unsecured debts, and for many homeowners it genuinely does reduce monthly outgoings. But it is not a decision to take lightly. You would be moving unsecured debt onto your property, which means your home becomes security for money that was previously not attached to it.
Getting this right matters.
This guide explains how the process works, who it suits, what lenders are looking for, and what the alternatives are. By the end, you should have a clear picture of whether this route makes sense for your situation.
What Types of Debt Can You Pay Off?
A debt consolidation remortgage is usually used to clear unsecured debts. These are debts not tied to any asset or property, which means the lender cannot automatically claim your property if you stop paying.
Common examples include:
- Credit cards
- Store cards
- Overdrafts
- Personal loans
- Car finance
- Hire purchase agreements
All of these tend to carry higher interest rates than a mortgage, which is the main reason consolidating them into a mortgage can make financial sense.
You can also use a remortgage to pay off secured debts, such as a second charge mortgage or a bridging loan. This is sometimes done when the rate on those products is higher than what you can get on a standard residential remortgage.
When Does Consolidation Not Make Sense?
There are situations where remortgaging to clear debt would leave you worse off.
A credit card on a 0% balance transfer deal, for example, is costing you nothing in interest right now.
Rolling it into a mortgage means paying interest on it for years. The same logic applies to any low-interest or interest-free arrangement. If the debt is already cheap, there is little to gain by moving it.
Similarly, if you only have a few months left on a personal loan, it is usually better to see it out rather than stretch those final payments over the remaining years of your mortgage term.
How Does Remortgaging to Pay Off Debt Work?
When you remortgage to consolidate debt, you are replacing your existing mortgage with a new, larger one. The difference between your old mortgage balance and your new mortgage amount is used to pay off your debts.
This is known as a capital raising remortgage.
A Worked Example
Say your home is worth £500,000 and your current mortgage balance is £280,000. You have £35,000 in credit card and loan debt. You could apply for a remortgage of £315,000, use £280,000 to repay the old mortgage, and use the remaining £35,000 to clear the unsecured debts. Your new loan-to-value (LTV) would be 63%, which is within what most lenders will consider.
Because mortgage rates are substantially lower than credit card and loan rates, and because the debt is repaid over a longer term, your monthly payment is likely to be lower than the combined total you were paying before.
To put this in context: the average credit card interest rate in the UK was 24.66% in December 2025, according to Bank of England data, while residential mortgage rates remain a fraction of that figure.
What the Lender Checks
A debt consolidation remortgage goes through the normal mortgage underwriting process.
The lender will look at your income and what you can afford to repay each month, your credit history and how you have managed existing debts, the loan-to-value ratio of the new mortgage, and the reason for borrowing (lenders must approve the purpose of the extra funds).
Most lenders cap debt consolidation remortgages at 85% to 90% LTV. Some specialist lenders will go a little higher, but this comes at a higher rate.
What Is Debt Consolidation?
Debt consolidation means combining multiple debts into a single arrangement, with one regular payment each month.
Instead of paying a credit card, a loan, and an overdraft separately, you pay one lender at one rate. Fewer payments, lower interest, and a clearer monthly picture.
Learn more: What does debt consolidation mean?
Why Does Debt Consolidation Cost More Over Time?
The important thing to grasp is that consolidation does not reduce the amount you owe.
It restructures it.
In many cases you are not paying less overall; you are paying over a longer period, which changes the shape of the debt rather than the size of it.
The Money Charity estimates that a credit card on the average interest rate, with only minimum repayments made, would take 27 years and three months to repay in full.
If you consolidate £30,000 of debt into a mortgage and repay it over 20 years at a mortgage rate, you will almost certainly pay more in total interest than if you had cleared those original debts in three to five years. The monthly payment is lower, but the long-term cost is usually higher.
For people under genuine financial pressure, that trade-off is often worth accepting. A manageable monthly payment can prevent missed payments, defaults, and lasting damage to your credit file. For those in a more stable position, it is worth looking at other options first.
Read more: Why do debt consolidation mortgages cost more in interest?
How Do I Remortgage to Consolidate Debt?
If you want to proceed, here is what the process looks like in practice.
Step 1: List All Your Debts
Write down every unsecured debt you have: the balance, the monthly payment, and the interest rate.
This gives you the total amount you need to borrow and helps you work out whether consolidation makes financial sense.
Ask each lender for a settlement figure, not just the outstanding balance. Some loans carry early repayment charges and exit fees, and you need to factor those in before deciding whether to clear them.
Step 2: Calculate Your Loan-to-Value
Your LTV will be your new mortgage amount (existing balance plus debts to clear) shown as a percentage of your property’s value. For example, if your home is worth £450,000 and your new mortgage would be £360,000, your LTV is 80%. Most debt consolidation remortgages work well up to 85% LTV. Above that, lender choice narrows and rates tend to rise.
You can use our online loan-to-value calculator to work this out quickly.
Step 3: Check Your Credit Report
Your credit file will show lenders how you have managed debt up to now. If your score has been affected by missed payments or high credit card utilisation, it is worth knowing this before you apply. Some lenders are more flexible than others, but a clean credit file gives you access to better rates.
A free copy of your report is available from providers such as Experian, Equifax, or through a multi-agency service like CheckMyFile.
Step 4: Speak to a Mortgage Broker
A debt consolidation remortgage is not a standard product. Not all lenders accept this purpose, the criteria varies between them, and applying to the wrong lender can leave a hard search on your credit file with nothing to show for it.
A whole of market mortgage broker will identify which lenders are likely to say yes, match you to the best available deal, and guide you through the application.
A broker will also check whether your current fixed rate deal carries early repayment charges for switching now, and whether it is worth waiting until that deal expires.
Is Remortgaging to Pay Off Debt a Good Idea?
For some people, yes; for others, it is the wrong move.
The answer depends on your circumstances and what alternatives are available to you.
According to StepChange’s Statistics Yearbook 2024, the average unsecured debt held by people who sought debt advice rose 7% year on year to £15,672 in 2024, with credit cards being the most common debt type.
For homeowners in this position with sufficient equity, a remortgage is one of the more practical options available.
This route tends to work well when your debts are costing you a high rate of interest, you have meaningful equity in your property, your monthly cashflow is genuinely under pressure, and you have addressed the habits or circumstances that led to the debt.
Ticking all four of those boxes makes a strong case for consolidation.
It is less suitable if you have a very low rate on your current mortgage and breaking it would trigger significant early repayment charges. The same applies if your LTV would push above 85% after consolidation, as this narrows your lender options and raises the cost of the new deal.
One thing worth keeping in mind: this route should not be repeated regularly.
If you consolidate debts into a remortgage and then build the same debts up again within a few years, you will have reduced your home equity twice without solving the underlying problem.
What Are the Risks of Remortgaging to Pay Off Debt?
Being clear about the downsides is part of making a sound decision, and there are several worth knowing.
Your home becomes the security. Unsecured debts are not linked to your property. Once you roll them into a mortgage, your home is at risk if you fall behind on payments. That is a meaningful and permanent change in your risk position. StepChange data shows that mortgage arrears among clients who sought debt advice increased by 69% between 2023 and 2024, a reminder that mortgage debt is not without its own pressures.
You may pay more in total. Spreading debt over a 20 or 25-year mortgage term usually means paying more interest overall, even if the monthly payments are lower.
There will be costs. Your current lender may charge an early repayment charge for leaving your existing deal before it ends. Arrangement fees, valuation costs, and legal fees can also add up, and some of these are not covered even by deals marketed as “fees-free.”
Lenders may apply restrictions. Some lenders place a cap on how much of the remortgage can be used for debt consolidation. Others may require debts to be cleared directly by the solicitor rather than releasing the funds to you as cash.
What Are the Alternatives to Remortgaging?
A remortgage is not the only option, and depending on how much you owe, one of the following may be more suitable.
Balance transfer credit card. If the debt is primarily on credit cards, transferring the balance to a 0% deal could stop the interest building and give you time to clear it. The 0% period is usually limited to up to 35 months on the best current deals, so this works best when you can realistically repay within that window.
Second charge mortgage. If you have a good rate on your current mortgage and do not want to disturb it, a second charge mortgage (also called a secured loan) allows you to borrow against your home equity separately. Your first mortgage stays in place and is unaffected.
Personal loan. For smaller amounts, a personal loan may offer a better outcome. Rates vary, but for amounts up to £25,000, the total cost of borrowing over three to five years can be lower than rolling the same sum into a mortgage and repaying it over two decades.
Use another property. If you own investment property or a second home, it may be possible to release equity from one of those instead, leaving your main mortgage untouched.
Free Debt Advice
If your debt situation is serious, or you feel like you are losing track of your finances, it is worth speaking to a free debt advice service before pursuing a remortgage.
These organisations are independent, confidential, and have no interest in selling you anything:
A debt adviser can help you look at all your options and may be able to negotiate directly with your creditors on your behalf.
Getting the Right Advice
Remortgaging to consolidate debt is a regulated mortgage transaction that falls under the supervision of the Financial Conduct Authority (FCA), the UK body responsible for regulating mortgage lending and advice.
Any broker or lender involved in arranging a mortgage must be FCA authorised, and you can verify this on the FCA Register at register.fca.org.uk.
Because the sums involved are significant and your home is at stake, getting advice from a qualified whole of market broker is sensible.
A broker will look at your full financial picture, identify the lenders most likely to accept your application, compare the available deals, and give you a clear recommendation. They will also make sure you understand the total cost of the new arrangement, not just the monthly payment.
If you would like to speak to a specialist, contact Respect Mortgages and we will connect you with an experienced, independent broker.
Frequently Asked Questions
Yes, you can remortgage to pay off credit card debt. It is one of the most common reasons homeowners use a debt consolidation remortgage. Because mortgage rates are significantly lower than credit card rates, switching the debt over can reduce what you pay each month.
You need enough equity in your home and must meet the lender’s affordability requirements. Bear in mind the debt does not disappear; it moves to your mortgage and is repaid over a longer period. With average UK credit card interest sitting at 24.66% (Bank of England, December 2025), the rate saving from switching to a mortgage can be significant.
You need enough equity to keep your new loan-to-value ratio within the lender’s limits, which is typically 85% to 90% for debt consolidation remortgages. If your home is worth £500,000 and your existing mortgage is £350,000, you have £150,000 of equity. How much of that you can access depends on the lender’s maximum LTV and your affordability. A broker will give you a clear figure before you apply.
Applying for a remortgage leaves a hard search on your credit file, which has a small, short-term effect on your score. Once the debts are cleared and you are making a single mortgage payment consistently, your score often improves over time. Your overall debt-to-income ratio falls and your payment history becomes cleaner, both of which lenders view positively.
It is possible, but your options will be narrower and more expensive. Lenders who work with borrowers with adverse credit tend to apply lower maximum LTVs and charge higher rates. Having a substantial amount of equity in your property works in your favour. A mortgage broker who deals with bad credit cases will identify which lenders are likely to consider your application.
Not exactly. A remortgage replaces your existing mortgage with a new, larger one. A secured loan (or second charge mortgage) sits alongside your existing mortgage as a separate product. Both use your home as security, but a secured loan is often preferred when you want to keep your current mortgage rate intact, especially if you are mid-way through a good fixed deal.
Yes. A solicitor or licensed conveyancer handles the legal side, including checking the Land Registry title and updating the mortgage charge. With a straightforward remortgage, lenders often provide a solicitor at no cost to you or offer a reduced legal fee as part of the deal. Ask your broker exactly what is included before you commit to anything.
