Borrow extra money?

dragonfly02

We currently have a fixed mortgage with Halifax for 2 yrs over 30yrs and are looking to borrow 10k for improvments and to pay off some other debts

Namely a vehicle loan repayment of 80 pound a month and a credit card.
My partner is looking into unsecured loans over 10 years but I think it would probably cost less per month to add to the mortgage,

Is this generally correct? I havent researched it too much at the mo as i'm not sure where to start.

The repayments on an unsecured loan would be arount 120 pound per month, how can I find out what the mortgage repayments would be if we added 10k on top?

Also if we added 10k to our mortgage is it classed as remortgage?(so i know where to start looking)

Thanx in advance

Mr_helpful

If you add to the mortgage it is not a remortgage but a further advance. Usually at Standard variable rate. However for a small reduction in monthly payments you are going to be paying for much longer and causing you loan in reality to cost much more. Also you are adding to your secured loan meaning you could be upping the chance of repossession if you got into difficulty. Affordability will obviously be the key decision but I would ring the halifax and see how much their further advance would be.

AndyWallace

Not sure if you'd get a 10k unsecured loan over 10 years. Have you checked?

Andy.

dragonfly02

thanx mr helpful i think i may have caused a little confussion, we don't have a secured loan at the mo only mortgage and a vehicle loan, credit card ect
the vehicle loan is not secured and our intention would be to pay off the vehicle releasing us of the 80 pound per month payment and payments from the credit cards so we only had the mortgage to pay.

Andywallace we have not tried to get and unsecured loan my partner was just looking around at the rates ect but I don't think it's the right way for us to go and am looking for alternatives

AndyWallace

Cut costs elsewhere if possible.

Buy Rapier instead of Stella
Buy 'MyMums' instead of Andrex - showing my age now
Buy smartprice instead of M&S

you get the idea?

putting 10k on your mortgage will probably cost £60 a month, so you'd save only 20 quid and the credit card payments, which may be very high, I don't know.

Andy.

Phirefly

AndyWallace wrote: »

Cut costs elsewhere if possible.

Buy Rapier instead of Stella
Buy 'MyMums' instead of Andrex - showing my age now
Buy smartprice instead of M&S

you get the idea?

putting 10k on your mortgage will probably cost £60 a month, so you'd save only 20 quid and the credit card payments, which may be very high, I don't know.

Andy.

OP was planning to spend a portion of the advance on home improvements though???

AndyWallace

Fair point, it was noted, but they are less than 2 years into a 30 year term which may mean they were stretched to start with. They have (probably) run up the credit card debts since getting their mortgage which suggests they are either overspending somewhere or cannot afford to take out another loan.

It's all assumptions. I could have just said yes you can get a mortgage elsewhere and this will reduce your immediate outgoings. That wouldn't be the right thing to do though.

Chances are they are tied to the lender, so a further advance could be possible depending on whether they can afford it. I am again thinking to myself why 30 years? If they went direct to the lender for their mortgage, and were put on a 30 year term then this likely because the lender needed to do this in order to get the agreed amount. Without knowing the circumstances i simply couldn't answer the OP's question.

Andy.