In Trouble!

codboy_2

Hey all,
i'm in trouble, i think and trying to get out seems harder than it should be!!
I have a £73k mortgage (2005) and recently have lost control of the demon credit cards. Since last year i have increased my salary and the equity in the property has soared too. I want to increase my mortgage, get straight and cut up the plastic money munchers. Bacause i was self certed on my previous income the mortgage company wont give a further advance. i would have to incur the penalty of £3500 and go somewhere else. stupid thing is, that would be ok money wise if i could get rid of the horrible mess i've made on my credit cards. i really don't want to get a secured loan cos they too expensive, how can i get the £20k needed to get straight?
cheers
Fish

payless

who's your current lender?

Have you tried 0% rated cc balance transfers

HelpWhereIcan

It may be that adding your card debts to your mortgage could protect your credit profile if you have had no defaults etc registered so far, but you should seek professional advice. It may be that paying the early repayment charge and switching lender is your 'best' option, but you would need to exhaust/dismiss all other options first.

In many cases, it can pay to look to arrange a debt management program through the CAB / Consumer Credit Counselling Service. This can help to reduce the payments you need to make to your credit cards. You will then have time to get back on track until you can settle them all (either through funds that become available or a remortgage in the future).

However, be careful before you enter one of these arrangements as lenders would be entitled and likely to register defaults on your credit file. It can be preferable to adding your debts to the mortgage though as they would not put your home at risk of repossession and the interest on your mortgage may be lower but will probably be paid over a much longer period.

You may find that your current lender has a minimum amount of time you must have held your mortgage before they will consider a further advance, if this is the case, can you hold out until they would look at one?

Have you looked at a personal loan for £20,000 - the Northern Rock, Tesco and other may do it over 10 years to help reduce the monthly payment. Having said that though, in most cases a personal loan over 5 years can work out lower than the minimum payments on credit cards.

As Payless says, post a little more about your current lender and other options you have explored and someone will be able to help.

Hope this helps

codboy_2

i'm with the mortgage works at the mo and i have looked at 0% CC transfers, but now i'm in a better frame of mind and am earning more, i just want to put all this to bed now, each month is just scraping by, but i know that if it wasn't for the minimum payments and subsequent interest on these, i would be able to be comfortable.

payless

Self cert is not really my thing...

but I think this is one of the cases were they put it on the broker to decalre its affordable, and if your applying direct, then they have not got the broker to "back up the affordability of a further advance " ( if in fact that would be a good thing for you to do anyhow...)

If you really want to follow that route, can the original broker assist

I notice you say "salary increases" - why did you go self cert ( was it bonuses ?? - even then some mainstream are open to consider )

codboy_2

when i took out the mortgage i was only on 16k, now i'm on 25k due to promotion, broker wasn't too helpful, but think this may be the best route. just spent the afternoon looking at loans and it's a nightmare!!

payless

TMW self cert is different to most , but never been keen to recommend s/c to salaried applicants myself

David_Dean

I am a mortgage/loan broker and I work regularly with lenders that dont use the traditional "income multiples" calculation on income, instead they use a set % of your monthly income. it may be that you could re-mortgage without needing to self cert your income.

codboy_2

as i was forced into moving on my own, had no choice, so i thought, but i'll see what the broker comes back with, thanks

payless

David , I agree that using affodability calc with traditaional lenders is better, but one would also need to consider the ERC payable