Mortgage and debt - unsure about advice given

Triangle

Hi

I currently have a Halifax mortgage with my DH. We have recently begun to consider moving again (in fact we have recently viewed our ideal home!) and today I had an appointment with an advisor.

We currently have three seperate credit card debts. We can get a new mortgage but not quite enough for this property. However, I was advised that if I consolidate these three debts into one monthly (loan) payment we would then be able to get a mortgage in excess of what we requrie. Would someone be able to explain why this is please - the debt amount would still be the same. It would be much appreciated

So our options seem to be to consolidate the debt and then will be in postion to move - assuming, of course, our house sells (which is something else to worry about).

Or we could wait a couple of years and in that time have a massive push in clearing those credit card debts. But it would mean putting the 'ideal house' dream on hold.

Many thanks in advance.

kingstreet

Halifax "taxes" your mortgage "borrowability" 5% of a credit card balance each month. If you consolidate to a loan, they only tax you the monthly loan repayment.

If one is lower than the other, a higher maximum mortgage is possible.

Clearing such debt altogether seems a better strategy than a consolidation loan, which will probably see you re-spend on the cards to "fit out" that dream home, leaving you twice as badly off as now.

When you are considering moving, look at other lenders, Halifax rates aren't great.

Thrugelmir

Triangle wrote: »

Or we could wait a couple of years and in that time have a massive push in clearing those credit card debts. But it would mean putting the 'ideal house' dream on hold.

A couple years suggests that the debts are sizable. This may well impact on a lenders decision if it is the case.