Convert to a Loan or Not

runner20k

I have 2 Credit Cards

Card 1 - £3700 limit - balance £3550
Card 2 - £1900 limit - balance £1800

I have recently applied for a mortgage - selling existing house which is in negative equity and have enough to cover that plus 10% deposit etc.

I have been turned down and told that i need to get the balaces down to 70% of available credit.

I have the chance of an unsecured loan to consolidate the 2 cards but would that affect the mortgage application. is it better to keep the cards and just reduce the balances as fast as i can or does it show that i am taking control by converting them to a loan and closing them .

I dont want to take out the loan and close the cards only to find it was the wrong thing to do .

any advice greatly appreciated.


mark

Thrugelmir

If you've enough money to raise a 10% deposit and clear negative equity. Why not clear the cards and reduce your mortgage by an amount as well?

getmore4less

Basicaly part of your deposit is borrowed on CC.

What rate are they on?