Newbie who doesn't know where to begin

cwoz82

Hi,
Having recently gotten married, my husband and i are desperate to move but need a slightly bigger mortgage - from 97,000 to 140,000 for our "forever " home!
The Problem?
We have debts, whilst controllable they are starting to frustrate and worry me as we can't seem to shift them; they are as follows
Loan - 3000 with 4 years remaining
Credit Card - 4000 balance
Credit Card - 1000 balance
Current Account - 1600 overdraft
My husbands credit rating is not so hot whereas mine tends to retain a fairly good status. We have a huge debate in our minds as to how to clear these debts, my personal feeling is i'd like a personal loan to clear them off in one fell swoop, have one payment and know this WILL be cleared in five years, but then we are told it's better to retain existing loans and use "tarting" on the credit cards, which i understand having worked in finance myself but i just can't formulate a plan as to how to pay that off - does anyone have any words of experience and wisdom to pass on?

amyandjon

hello and welcome... firstly id asy post a statement of affairs up i dont know how to do a link but its in a sticky at the top of the page..... also i wouldnt advise a loan to consolidate your adding on infact with some hard work and determination you could even pay the 4000 loan off eary after the others... im not clued up om credit card tarting but if you can get 0% deals id move it about and if your doing really good you may even get the loan on to a 0% credit card and work hard at clearing it off .... anyway see what teh soa brings and im sure others will be along with much wiser advice good luck on teh journey x

sortingfunds

I would possibly use the knockdown route,

Pay off the most you can on the debt with the biggest interest rate, whilst paying the minimum on others. Gradually you pay one off at a time rather than being saddled with one big debt payable over god knows how many years!

I tried to consolidate my debts just ended up running them up again in the past so I am currently paying as much as I can on debts with biggest interest then minimum on rest and I m glad to say its working for me.

Stick with it

hypno06

Hi there.

The things that spring to mind are:

Put the debt figures in the snowball calculator at www.whatsthecost.com and join a challenge or two on this site to help get the extra income in to knock them down in record time.

Do your statement of affairs using the sticky for newbies at the top of the board so we can see where you can make slight changes.

Do you have a timescale for wanting to move - be realistic. do not move too early otherwise you will end up not being able to pay your debt and the additional mortgage. It is easy to be seduced by the "forever home" stuff but there is no point having "forever home, forever stressed with debt".

You say your OH has a less than brilliant credit record - this will impact the availability of attractive mortgage rates for you - whilst it won't probably stop you getting a mortgage, it may well be more expensive. A few years rebuilding credit ratings, knocking the debt on the head and saving a deposit for the house could well be the way forward.

believe me, I too am working towards my "forever house" and I will be extending my mortgage big time in order to get it. BUT I will not do it until I am debt free and have the available deposit. I have set my sights incredibly high, but as a result I am highly motivated to become debt free before I start sending off for estate agents details!