Cash endowment to pay off debt and then switch to repayment?

doozeruk

Hi everyone

Firstly I couldn't make up my mind whether I need to be posting here or the debt free wannabe board, so I plumped for here because I believe this to be the most relevant.

I have a dilemma that I hope some kind folk can help me with please.

I am a self-employed 33 year old, married with 3 young kids and only 4 years ago discovered credit cards, unfortuantley, although I THINK I am clever with money I am obvisouly not . I have amassed nearly £4000 on the wretched cards and also have a loan with £4000 owing to be paid over a remaining 4 years.

I am wondering if the following theory is a good one or not!

I have a mortgage of £36500 on a property worth around £110000, the mortgage is an endowment and obvisouly we have a shortfall on this. I have 12 years remaining and its current surrender value is just over the £9000 mark, enough to pay off the debt. I thought it would then be sensible to remortgage the property at £36500 still but on a repayment mortgage over the remaining 12 years.

At the moment I hardly have any left over income. The loan is £120 month and the credit cards, which are mostly always minimum payments are around £100 p/m. The reason I think I am good with money is because apart from £600 the other credit cards are all life term low rates of 5.9%, but obvisouly this is still not really working out all that well:o

Does anybody have any comment they would like to pass on my idea or should I just plod on and get these things paid up in 5 years time :eek:

Many thanks in advance.