Please, Please Help

dazzadee

Im unmarried but been living with my wife to be for 13 years and have a 4 year old daughter.
Now we have a mortgage of £75000 and the house is worth about £110000 and we want to pay our debts off around £30000 on overdraft, credit cards, loans and cataloges.
what would be the best way to do this, beeing we earn around £1300 a month between us.

thanks darren, kelly & holly

MortgageMamma

Hi Darren
It is possible to do this, but I would need to know more about your situation.
Have you missed any payments or got CCJs or defaults?

dazzadee

missed a 1 payments on credit card this month only but weve got no CCJs or defaults.

financial_solution

Hi,

is the £1,300 pm net or gross?
are you employed or self-employed?
do you have any finance or credit commitments which will still be going after the re-mortgage or will ALL credit and finance be cleared....need to assess your affordability.
Do you get any working tax credit or child tax credit...if so is it includrd in the £1,300 pm.

good luck,

mark

silvercar

Transferring all your debts to your mortgage would mean securing them on your home; as the adverts say, your home is at risk if you don't keep up repayments.....

You would then have a mortgage of 105,000 on a property worth 110,000. This is a high loan-to-value ratio and could cost you. I am nervous about you securing so much debt. If you fell behind with your mortgage payments you could find your self in serious trouble.

dazzadee

thanks for your help.

in answer to your question we earn 1,370 pm gross inc child benifit only and were both employed. ALL credit and finance will be cleared.

*EssEncE*

dazzadee,

Take note of the comments made by 'silvercar'

You really need to look at all possible options before jumping straight down the mortgage road.

Your LTV (Loan to Value) will be just over 95% which will restrict your availability. Your mortgage product rate will be high considering both the high LTV along with your missed payment. To a potential lender you would be high risk, therefore the rate they offer you will reflect such.

For example an average fixed rate mortgage available to borrowers in your position might be 6-7%, and on a repayment basis your looking at a monthly payment approx £700+.

mightymouse

Hi dazzadee

I am a newbie so I will add my two penneth.

If you did add the debt to the mortgage as has been said you are making unsecured creditors secured and with a 4 year old in the event of unemployment there would be no help with the added amounts.

It may be that any of the debts (including Mortgage) might be in single names so I would lean toward an agreement with creditors or further, possibly an IVA but leave the mortgage alone.

dazzadee

ok the re-mortgage not such a good idea [even though we could live with £700 a month], what are the other options as were crap with finantal things and know nothing[probably why were in the poo now].
what is a IVA?

thanks for all the help
darren

mightymouse

Hi dazzadee

An IVA is an Individual Voluntary Arrangement and more detail will follow but first a word of CAUTION it is worth taking the time to talk to Citizens Advice or Consumer Credit advice where the advice is FREE so that you have as much information as you can gather before taking any action.

What is an IVA?
An IVA is an agreement with your creditors to make a single reduced payment each month which lasts for a sensible period of time (normally 5 years). Once agreed, creditors are not allowed to add further interest or charges to your accounts by law. The agreement is fixed - meaning that creditors can not randomly demand changes to it. The arrangement is governed by the Insolvency Act of 1986. A common misunderstanding is that people think undertaking an IVA is like going Bankrupt. This is not the case. The IVA is specifically designed to avoid the many issues and stigmas surrounding Bankruptcy.

Good Luck

chinagirl

Hi, we are in a similar situation, we have mortgage of 86,000 over 22 years on house valued at £140,000. We also have bank loans of £19,000 and credit cards totalling £3,000, obviously unsecured.
We too are thinking about remortgaging to pay off all our debts and just have the mortgage. What we pay out at the moment on loans and credit cards, is a lot more than the remortgage monthly figure will be, so we will be better off each month.
Our worry is if things change in the future, with my or my husbands jobs, ability to pay, but if that happens, we would not be able to pay our existing mortgage or any of the loans/credit card payments either.
We thinking is it better to remortgage now, whilst we have good credit rating ?
We writing to bank to ask for final settlement figure, then will decide what to do. Bit scary, as whatever we do, is gonna cost us, it is just 'damage limitation' when you owe money!
What do you all think, would appreciate your input?