Remortgaging with arrears on 2nd loan: Advice needed

mce99

I did originally put this in the Mortgages & Endowments section, but I was advised to post it in this section instead....


I live on my own & I have a mortgage with about 13 years left to run on a house that’s worth about £80k-90k. I owe about £29k on it. Interest rate is about 5.6% I pay about £260 a month this is up to date (I’ve only just got up to date with this after being in arrears to about 3k)

I have a 15K loan (they want about £21k to pay it off) secured against the house, this is on a high interest rate of 13%. I am about 5 months in arrears to this, which are about 1k. My monthly payments are £210.

I have about 13.5k worth of unsecured debt,


29K = Mortgage
21k = Secured Loan
13.5 = unsecured debts

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This all comes to about 63k

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I am looking to remortgage as I’m paying out too much at the moment, my current mortgage lenders, Bradford & bingley, do not offer remortgaging, so I’d have to go with another lender.

I really want to keep the house (but I know I may have to sell to get straight, just worried about getting on the property ladder in the future if I have to start again)

Obviously I will have really bad credit but do you think anyone will help me remortgage & lengthen the term to 20 years. I don’t really want to end up having to pay really high interest or there is probably no point doing it.

Any advice welcome

Thanks

geoffky

renting is freedom..property ladder is a marketing tool, owning your own house with a mortgage is renting from the bank...dont worry its a roof over your head at the end of the day..i think you will struggle with re mortgaging as your debt levels are very high and they will see that. you better have a plan b

bottleofred

Hi mce99 and welcome to the forum,

It's entirely up to you what you decide, but I think you'd be better selling the house, clearing the debt and then renting. As I said though, it's entirely your choice, but you're going to end up paying lots of interest and I think you will also find it difficult to remortgage at a decent interest rate.

Good luck

Red

haras_nosirrah

Are you missing payments on the unsecured debts too?

Your credit record will be shot to pieces anyway. If you want to keep your house you are better off missing or making £1 payments to your unsecured debts and getting up to date on the secured debt than getting into arrears on a secured debt - the 2nd charge company can take your house, the credit card company can't.

mce99

Thanks for your quick responses guys, much appreciated