What to do, IVA or re-mortgage to clear CC and loan debts

AFCChris

I have £35000 on credit cards and £23000 on a loan which I want to clear or certainly reduce monthly payments on. I am in the process of getting a remortgage which will clear the CC debts completely but increase my mortgage but will put £300 a month on my monthly payments.

I was wondering whether this was a wise move or whether an IVA will be better in the long run?

Appreciate any guidance!

Cheers

Chris

angelavdavis

There are lots of people on here that will agree with my thoughts - please don't consolidate! It is a sure fire way to disaster long term.

Why not post your SOA up on here so the good folks on here can pinpoint areas you can save so you can throw the extra money on the debts.

Putting your £35,000 on your mortgage, assuming you get a rate of say, 5.75% (which you will lucky to get) borrowed over 20 years - you are talking about paying a total of 58975.01.

Then say for definite you will never spend again on credit cards Let's face it, its highly unlikely.

All you do by consolidating is putting the debts off for another day. The only way to get on top of your debts is by knocking down your expenditure and paying more off and switching debts to lower interest rates.

pania

Here here! completely second the above, as a Mortgage advisor i totally cringe if people remortgage to secure extra debt, as angela says can you honestly honestly say those credit cards won't be used again? can you afford an extra £300 per month, remortgage to a cheaper product if appropriate to RELEASE some money monthly not to take up more. speak to your MA or IFA to see if there is a cheaper deal than that you're currently on, and get that SOA up so we can advise you of the way ahead!!

Good luck with this, you've come to the right place for help.