30k credit card debt advice and remortgaging

garj12

Hi,

Like a lot of people would appreciate the communities advice/suggestions.

I've currently got 265k mortgage 2 year fixed, which is due to expire in January, and recent house price moments should bring us just under 75% LTV.

I was therefore looking around at mortgage deals currently available, and can across a slight snag.

That is, between my wife and myself we currently have about 30k across 4 credit cards, probably about 2/3 sitting on 0% card's with about 10 months left. All minimum payments.

I also have 24 months left on a previous card consolidation loan, payments are 350 a month.

We currently have a monthly household income of around approx 4500 so we're covering the all the bills etc, but haven't been able to build any savings.

We don't take expensive holidays or wild lavish lifestyles, but have found that somehow family life (3 kids) and an impatience to wait for purchases has led us to this position.

Would therefore appreciate thoughts on way forward. Should I get another loan for the cards, look to add into a remortgage... Or any other suggestions.

Tixy

Hi and welcome to the forum

I wouldn't remortgage to borrow additional funds to pay off the existing unsecured debts, I'd just focus on getting those paid off as soon as you can. You've alreadt consolidated your debts once, but sounds like you have run them up again so are still overspending each month.

I'd be working as hard as you can to start paying more to your debts. Whilst you say you are covering the bills if you are only paying minimum payments it is going to take you a long while to clear your debts.

How long did it take you build up the £35k worth of debts? as that will help you work out how much you have been overspending by each month.

You mention not having been able to build savings - that makes sense - as the interest you pay on the debts would be higher than the interest you would earn on savings.

If you can spend some time now working out a realistic budget and looking at what reductions you can make to free up more for the debts then you can work out how long it will take you to clear the existing debts.

Once you know that it might help you decide better what to do with the mortgage in a few months time.

garj12

Thanks for the welcome.

While I can appreciate the advice, I obviously wouldn't expect any real change in that balance within 3 months.

From my searching, it would appear that most (not sure if all) would reject me in terms of outstanding debt. Reverting to SVR would just increase my mortgage payments and further squeeze my finances.

Tixy

No I appreciate the balance isn't likely to go down much in 3months - what I thought was it would be easier for you to make a decision once you have a better understanding of your financial position and how long it will take you to clear the debts.

Might be worth speaking to an independant mortgage broker to see if they can suggest any lenders who would consider offering you a fixed mortgage in your current financial circumstance.

Have existing lender said they are not willing to offer you a new fix at a better rate than their SVR?