Consolidate debts with a remortgage???

chinagirl

Hi. My husband has finally faced the truth about how much debt he is in, mainly due to business loans taken out when he ran his own business - to buy the business and stock etc - but no capital left to pay any of it off, as was cheated out of it by an unscrupulous car dealer etc, but that's another story.

However, DH worked out the loans owing to the bank add up to roughly £16000. I have 2 x credit cards totalling £3000 and DH has an overdraught on an old business account with the bank needing about £3000 to clear it. Grand total £22000.

Dilemma is, do we remortgage, and utilize some of the equity in our house to clear all our debts, greatly reducing our monthly repayments. House is worth about £140000, and we owe £86000 on our mortgage with 22 years left to pay.

If not, what would be best way to deal with our debts.
I have applied for a Marks and Spencer life of balance credit card and was gonna tranfer my £3000 credit card balance to it, but thought probably be good to lump all our debts together if we were to add to the mortgage.

Welcome anyone's advice here. DH is good at being an osterich, and has been very good at hiding all his business debts from me up until now.

Sea78

Hi,

Take a look at the sticky at the top of the board about SOA - statement of affairs - and have a go to see if we can help. I considered remortgage, but realised it wouldn't help anything - i would probably rack the debt up again if I wasn't going through the learning curve AND I would have even more to pay off!

Depends on how you feel really.

Sea xxx

SunderlandBlackCat

Noooooooooooooooooooooooooooooooooooooooooooooooo!

Hi CG

Now I've got that out of the way have a look at this thread

http://forums.moneysavingexpert.com/showthread.html?t=107280

Theres a template there for creating a SOA. Once you've posted yours & we've had a look at we'll be able to suggest appropriate ways to help but I can pretty much guarantee consolidating onto your mortgage won't be one of them.

As an example if added my debts as they are now to my mortgage it would cost £3,235.55 interest. :eek: If I carry on paying them directly they will cost £10 in interest.

B2B_2

Hi there

I have just posted a similat thread "is this the solution". Can I ask you how you felt when your husband finally owned up? This happened to me in April last year and I felt like I had been cheated on for the seven years we had been together! I am still angry and can't help but yell and scream at him sometimes. I've always been ok with money so felt hurt that he felt he couldn't tell me and stupid for not having realised sooner. He is just not great with money and his stupid best friend had given him wrong advice eg get an interest free credit card and your minimum repayments will be £80 less a month. Duh!

Really, I just want to know how it has affected your relationship (don't tell me if you don't want to as it is very personal).

chinagirl

Forgot to add, DH and I discussed trying to add to our mortgage, so that we could offer the LloydsTsb Collections Dept, who are dealing with the outstanding debt we owe, a settlement figure, to pay them off, so to speak. We thought if we offered say, half of the £20000 odd we owe, they might agree to write-off the rest, as DH has been on a repayment agreement at 0% with them for last 18mohths. Bank Collection Dept have just agreed to continue the payment plan (£334 and £100) for a further 6 months, but say that is it, will not be possible to negotiate a further deal.

SunderlandBlackCat

chinagirl wrote:

Forgot to add, DH and I discussed trying to add to our mortgage, so that we could offer the LloydsTsb Collections Dept, who are dealing with the outstanding debt we owe, a settlement figure, to pay them off, so to speak. We thought if we offered say, half of the £20000 odd we owe, they might agree to write-off the rest, as DH has been on a repayment agreement at 0% with them for last 18mohths. Bank Collection Dept have just agreed to continue the payment plan (£334 and £100) for a further 6 months, but say that is it, will not be possible to negotiate a further deal.

Is he on a formal DMP or isthat just an informal agreement with LTSB?

chinagirl

SunderlandBlackCat wrote:

Is he on a formal DMP or isthat just an informal agreement with LTSB?

Pretty sure it was an informal agreement. The bank are partly to blame for the mess we are in, as they were taking the money out of an old account and racking up a huge overdraught, when we realised, we argued could not possibly catch up the payments in one go, and our account was passed to their collections dept, who agreed to the repayment plan. However, as I said, we only have another 6 months paying this arrangement, then everything reverts back to the original payments.
DH has asked the bank to give us the total outstanding amount we owe, and when this comes through, we will have a figure to work to. (I feel bad I don't even know what we owe,I think its denial on my part and certainly DH's part)

itsarichmansworld

:hello:
I'm re-mortgaging as all my debts are high interest rates however we plan on overpaying the mortgage.

Most people say no to re-mortgaging for this purpose but If you can trust yourself and dh not to rack up debt again then it may be an answer.

Before you do anything do a soa so we can have a look and see what we can help with.
:grouphug: