Transferring unsecured debt to a mortgage

getmore4less

Prices are going down so you don't just create equity and get out of debt.

expect the slump to last 10 years the last one did.

You don't pay off debt by borrowing the money from somewhere else.

Stay at home or rent the cheapest place you can and save for a big deposit or pay of the debt the preferable option.

neverdespairgirl

Deleted_User wrote: »

Sorry, I didn't meant that house prices always go up. Merely that I think it's a fairly safe assumption that in 3 - 4 years time house prices will be above the point they are going to be at the bottom of this crash?

That's not remotely a safe assumption!

rover25

Could you do what the op is suggesting if you were to self build? take mortgage out for eg. 100 grand to build (v.modest house), when its valued after completion it will be worth eg 160 grand plus? LTV ratio would still be okay if you added on the past debt to the 100 grand mortgage. All assuming a 10% deposit on the build mortgage is achievable for the op. Perhaps not, but just a thought.

ixwood

You live at home with a good salary, so why are you still in credit card debt? Do you still spend on them? Why don't you take advantage of your cheap accommodation and just pay down your debts super quick and then save a deposit?

Without a deposit, you've no chance and rightly so. Running a house/mortgage costs a lot of money and you're clearly not financially prepared/competent enough.

Incisor

Deleted_User wrote: »

Yes, that is the sad news I had expected.

To clarify, what I meant was that I am finding my personal debt repayments quite depressing and even though I can afford the repayments, I'm just a bit frustrated to have sit back and see other friends get on the property ladder where good returns can be had, all because of my debt. My debt gets me down quite a lot and I'm not going to pay it off before I'm 30 at the current rate.

It's a bit chicken and the egg - if I could get on the property ladder, I would be able to pay my debts off faster (assuming property prices inevitably increase again). But, because I have debts, I can't get on the property ladder.

I'm not concerned about paying the debt back over a longer period, but currently I pay out £600 a month and that goes straight to a bank. I was just interested to see if I could continue to pay £600 a month, but at least get something back in the way of equity in a home.

Does your advice still hold for properties in the HomeBuy-type schemes whereby I am only getting a mortgage for 50% of the property value? I assume it still does, given that I wouldn't own the other 50% and so as far as the mortgage provider is concerned, I am getting a 100%+ mortgage still (but just for a smaller amount)?

Thanks.

You are in financial cuckoo land. You are quite safe being off the 'property ladder' for a few years yet. If you could get on it, you would make a loss while corrections are happening. In your situation, the loss on property will only add to your debts. Just sit it out and like ixwood says, try to pay off your debts quickly. Once you have done that, don't stop, carry on saving a deposit for a house on 100% ownership. Shared ownership is designed to sucker those in financial cuckoo land to pay too much for property and to land them with the risks of a falling market. You only see them when the market is falling

Kez100

You know how much this debt is getting you down? Well, can you imagine how you would feel if you had that and a family and a home and couldn't move due to negative equity. Right, that is pretty bad, heh?

Now, get over to DFW board and while in cheap accommodation get those debts paid off asap and, once done, then turn those monthly payments into savings. Only once you have built up a pot can you think further and take with you into home ownership the lesson you are now learning so you live within your means when times really are difficult (which they are when you first have a family).

Thank your lucky stars you are in a position to get on top of this.