Realising equity from 2nd home

mikeg1

An update after good advise from this board (thanks), I have today visited an idependant mortgage adviser who have discussed rates offer by TMW of 4.99% fixed for 2 years for £40k. This would not need any proof of either my wifes or mother in laws earnings. Just confirmation of rent income. This has now gave me chance to at last get a good nights sleep. We might still move and raise capital that way to clear some debts (I know the suggested option), but we would like to keep our home and might be able to with loan repayments that today are under 40% are the huge credit card repayments we have. At we have options to consider now. Thanks to all for input.

Thrugelmir

mikeg1 wrote: »

The companies we have aproached to re-mortaqe suggest we have too many expenses to enable to meet repayments, I do not think this is the case - as the repayments for a remortgage loan its self will be under a 3rd of what card repayments are.

Herein lies the problem. Lenders are not interested in refinancing debt in the current market. As primarily they'd much prefer you to pay unsecured lending rates. Also lenders are contracting their loan books, so are cherrypicking the best applications. They have no desire to take excessive risk, unless they charge a premium rate.

Thrugelmir

mikeg1 wrote: »

An update after good advise from this board (thanks), I have today visited an idependant mortgage adviser who have discussed rates offer by TMW of 4.99% fixed for 2 years for £40k.

Around 3.5% for an arrangement fee.

Whats interest rate after 2 years?

mikeg1

Thanks Thrugelmir
Yes the arrangement fee is high - 3.5%. Interest rate after 2 years is at 4.99 (today!).
Do you have any other thoughts, I am moving away from DMP. Not for us.
So option is alternative loan, re-mortage similar to above or moving.
Your comments are appreciated.

Thrugelmir

A totally different tack, and not an easy one to stomach.

Have you considered selling your existing property, realising the equity, clearing your debts and starting afresh?

While the disruption would be considerable in the short term. You'd soon be in a far better financial situation. No stress either!

I'd still opt for selling the property myself. Perhaps explaining your situation to the MIL would prove beneficial as well.