Arrears on Mortgage advice

modchick77

Hi

I have £1400 arrears on my interest only mortgage of which my current deal comes to an end in July this year.

The arrears have come from being made redundant and putting my payments on hold for three months. I am still not in permanent work but seem to be having a steady flow of temp work at the moment.

I am paying back £30 a month on top of my normal monthly payment to try and clear the arrears although I am going to try and up this to clear the debt.

Is it worth breaking my back and putting the arrears first and trying to clear the £1400 in time for July so that it will make it easier for me to get a good remortgage deal or will it make no different now that the damage has been done and should I continue to make small payments?

Also 1 monthly installment was missed (i didnt have enough in my account when they took my DD out) although this was rectified the following month when they took two months payments out.

I have always made every other payment on time and until this time of redundancy have never been late with payments. I also have no credit cards, never have. I do have a rather large overdraft though.

I have ordered from experian a copy of my credit rating am awaiting this in the post.

I want to try and get things sorted before July when I have to sort out my mortgage.

Any advise would be gratefully received.

VIGILANT22

who is yr lender

modchick77

I am with Alliance and Leciester.

I took out the original mortgage with them in 2006 and when they deal came to an end in 2008 I stayed with them after looking around as they ended up being the cheapest and best option.

Conrad

mod, no decent value lender will be able to consider you until at least 12 months have elapsed from the date the arrears are cleared in full.

modchick77

So what options will I have in July when the time comes to renew the mortgage deal? Will I be able to get another mortgage? Will I be able to stay with Alliance and Leciester?

I find all this so confusing.

Conrad

Staying with A&L should be fine, but I do not know what rates they will offer. I suspect they will only offer the standard variable rate which is probably low just now. Call and ask them.

modchick77

Thanks you for your advice.

A friend has suggested to clear the overdraft that I have that I get a 0% credit card to pay off the overdraft and then pay the credit card back each month.

Is this a good idea and would I actually be able to get a credit card with my current situation?

getmore4less

Whats the OD costing you and how big is it

Most 0% CC come with a fee so it may not work out and if the CC is not paid off in time the rate will be very high.

modchick77

The overdraft is £1300 and Im paying £20.97 a month for the fee.

Im thinking I will leave that for now.

Thank you for all your advice

Bloody recession!!! its got alot to answer for!:mad:

motch

Hi modchick

Going for a 0 % balance transfer would be good (if you can get one) better to pay about 3% fee for a year rather than almost 20% on your overdraft. Perhaps one for spending on too, interest free for a year would be good (again if you can get one with missed payments on file) and pay off the arrears.

Obviously need to sort out your income / spending asap and cut out all unecessary spending big time.

sell off all stuff you don't need, ebay, free ads etc

Join Quidco

Consider getting a Lodger if possible and if you have a spare room.

How much is your mortgage LTV ?

SouthCoast

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