I know it's late but...

Galeboy

CFC wrote:

I'm in total agreement with this. Extend the mortgage term, do not take out more money to pay off the ccs, but use the extra money to kill off those loans.
A vision of being mortgage free, is quite honestly with the level of earnings you have, and presumably wanting a reasonable standard of living (hence the use of ccs) is just a dream. And to be frank, once you've paid off your CCs, it will probably stay a dream with a young family.

Once the ccs start coming down, stop and think. Hey, it's time to do some financial planning! That means you and your best beloved sit down and talk about what you both want out of life, what your ambitions are - and then design your finances around that. If you both have the dream of being mortgage free, and cutting down working when you're 53, and you're willing to live like a family of poverty-struck cats in order to get there, you can remortgage again with a shorter term. If you want to bring your children up to have particular family experiences, you can budget how much you're going to need for that and organise your finances around that instead. If you want a midlife crisis sports car and several exotic holidays when you have your mid life crises, you can plan for that.

This way your dreams will have a basis in reality and you can make them come true.

Thanks for this. Actually, the mortgage free vision (which was to pay off £78k in about 10 years) isn't that unreasonable given a current salary of £40k...and with my wife's salary (when she returns to work in 4 years time) being about £30k. And rather than re-mortgaging again with a shorter term, I would rather choose a flexible mortgage to allow overpayments.

CFC

Hi Galeboy, your current salary is 40k and there is one earner in the family. True, a lot of people would be grateful to earn 40k, but on the other hand it's not a lot with a young family. At the moment being mortgage free appears to me to be an unrealistic vision. If your wife does return to work in 4 years and earns 30k, it may well be realistic then. Not being funny, but if it was realistic now, you wouldn't owe money apart from your normal mortgage....

I would also strongly urge you to sit down and plan what you want to do over the next 10 years. Even if your wife does return to a 30k job, with 4 children, I think you really do need to seriously think about what you and your wife want out of life. You don't need me to tell you that there's more to life than being mortgage free, if by the time you've got plenty of money to take the kids to interesting places and do interesting things, they're old enough to think you're boring and they don't want to be seen with the family, thanks...

Once you and your wife know what your priorities are (mine would be a wonderful sports car, ready for my mid life crisis! LOL), you'll know exactly what you want to do and how you want to live.

Angela_D_3

Most people who just add the credit card debt to the mortgage run up those debts again, it's a sad fact but if you don't go through the pain of paying off those debts you'll more than likely be back here in 12 months.
I would move the balances onto 0% cards and get them paid off asap.

Galeboy

Angela_D wrote:

Most people who just add the credit card debt to the mortgage run up those debts again, it's a sad fact but if you don't go through the pain of paying off those debts you'll more than likely be back here in 12 months.
I would move the balances onto 0% cards and get them paid off asap.

Hi Angela,

I'm not going to add the CC debt to the mortgage. I will extend the term (but not the amount) of the mortgage and snowball the CC debts with the money freed up from the reduced mortgage payments.

So incoming-outgoing won't be changed, but the CC debt will fall much more quickly.