Help with remortgage- partner has huge debts I didn't know about

houseiseverything

Last week my partner told me that he is has a 30k credit card debt and a 20k overdraft. He has just lost his job so now can't pay these debts. I am desperate to clear the debt, as I don't want our house to be at risk. My plan is to sell our endowment policy- we can cash it in for46.5k- in order to pay it. I am then going to remortgage our house in my name only (he has no income currently) in order to switch from an interest only to a repayment mortgage. This is going to cost a huge amount in the long run I know, as our mortgage payment will be much higher, we will have to pay it for 5 years extra.

He has always paid the credit card companies on time for the past 5 years, but on Friday asked them to freeze the interest, which they have done. Also, he was a director of a liquidated limited liability company. Will this show on his credit rating, and will that effect my credit rating and stop me getting the remortgage? I asked the mortgage broker at the bank, and he didn't know. I can't remortgage until April as I would have to pay a fee to get out of the current mortgage which I just can't afford. I am terrified we could end up in an even worse situation. Thanks so much in advance for any help.

beecher2

Can't you switch to repayment without remortgaging? Or simply overpay until April when you can re-assess your options.

Try not to panic - if you post a statement of affairs on the Debt Free Wannabee forums you'll get help on there with your budget. You'll also get emotional support on there too - it'll take a while to sink in what's happened I am sure.

Simon_gloster

The only question I can see from your post is about the company folding and it effecting your credit rating, is this all you need info on?

Remortgaging with the other person on the deeds but not the mortgage may be an issue to some lenders. May as well have them on there, income or not, as you would have to declare your marital status or have any dependants, therefore they would be taken into account.

You would also need to transfer the equity from joint to sole if you want to use your plan costinh you around £500..

houseiseverything

Thanks for the replies. Yes, sorry, what I need to know is if my credit rating will be affected by his status.
The current mortgage provider wont put us on to repayment without paying a huge amount!

Simon_gloster

I can understand some providers not allowing repayment to interest only unless real hardship, but the other way round, thats unfair.

Is your lender still trading and lending money? Ive only seen comments like this when someone is with a sub prime lender.

Thrugelmir

Is the overdraft a Company debt?

If so what is the security for the debt?

beecher2

houseiseverything wrote: »

Thanks for the replies. Yes, sorry, what I need to know is if my credit rating will be affected by his status.
The current mortgage provider wont put us on to repayment without paying a huge amount!

Work out how much a repayment mortgage would cost you and overpay the difference.

houseiseverything

Yes, the overdraft is a company debt, secured by him personally but not against the house.
It is Santander who will not allow us to go on repayment...their interest rates are going up a lot apparently.
Our current motgage runs out in April. If we stay with Santander the interest rate will be 4.7, so we will have to remortgage, which is why I need to know if his credit rating will impact on mine.
I will start overpaying straight away! Thanks.

Thrugelmir

houseiseverything wrote: »

It is Santander who will not allow us to go on repayment...

There is nothing to stop you overpaying the mortgage. This in effect makes the mortgage a repayment one.

kingstreet

If you have joint accounts, his credit situation will affect yours. These include mortgages, loans and current accounts.

You may wish to obtain copies of your statutory files from the three CRAs to see what's on them;-

Equifax

https://www.econsumer.equifax.co.uk/consumer/uk/gb_consumerletter.ehtml

Experian

https://secure.wiseconsumer.uk.experian.com/wiseconsumer/secure_index.html?data=00

CallCredit

https://www.callcredit.co.uk/stat-report-online/index.php?action=register_display&tpl=regPurchase

houseiseverything

I have another question please. Should I take loan out to pay his debts? I could get a 25k loan at 7.7% and a 20k loan from a family member at 5%.I feel that giving up the endowment is madness, as it is on track. It is unit linked, which I understand means it's more likely to achieve the 128k it is supposed to. I feel like we are throwing away 128k in the long run in order to get our hands on 50k now. Or is there another way I should be looking at it? Thanks