a clear distinction between equity release, additional borrowing and remortgaging

[Habib123]

Hello,

I am thinking of acquiring a btl but I am getting confused by the meaning of the below three terms;

Equity Release,
Additional borrowing
Remortgaging

So I live in a leasehold flat worth approx. 150k and in reasonable nick ( few wear and tear elements but nothing that can't be fixed ). I have a mortgage of 51k so have 99k in equity. I want to use some of this equity to put down as a deposit on a btl property. Is this called equity release as I had made a posting some months ago where I was told it was a product targeted at the over 55s. ? My lender, NatWest called it additional borrowing so are both terms essentially the same thing ?

Remortgaging - this is when you switch your mortgage debt to a more favourable rate and terms either with an exisiting lender or another lender. What I am thinking of doing is not remortgaging ?

these terms seem interchangeable and the more people I speak to , the more different the answers I get.


can someone please finally put me straight ?

thanks,

habib.

 

[Longterminvestor]

Equity release and additional borrowings are very similar because you are raising additional capital using your paid up share of a home as collatoral.

Remortgaging, as you say, is simply switching mortgage products to take advantage of more favourable terms. If the value of your property has increased you may be able to borrow more on the new mortgage.

 

[lookinginvest]

To be fair they are all ways in which you can secure additional funding from a property by using the property as collateral.