Secured loan when remotgaging...

Eastlands70

PeacefulWaters wrote: »

I suppose your other option would be to try and get a sub-5% unsecured loan to pay off the secured loan with. Shorter term would mean higher payments though.

You might not get the lowest advertised rate from an unsecured lender either.

That had crossed my mind but then I had another idea which would save even more interest and that was to get a Virgin credit card, do a money transfer into my bank account, and pay off the secured loan that way. They're offering 0% on money transfers for 29 months (plus a 4% fee obviously). I'm not entirely confident I could pay it all off in 29 months but could always transfer any outstanding balance to another 0% card. Just in case I was to go through with this, NRAM told me I had made over £5,000 of overpayments on the main mortgage so far and said I could use that £5k+ to reduce what was owing on the secured loan while increasing what was owing on the mortgage by the same amount. This means the amount outstanding on the secured loan is now less than £10k.


Even accounting for the money transfer fee and any subsequent balance transfer fees, it would save a huge amount in interest when compared to what I'm paying on the secured loan and what I might be paying on an unsecured loan. The downside is that with me taking on thousands of pounds of extra unsecured borrowing will of course reduce the amount of money the bank might lend me when re-mortgaging!

dimbo61

No sorry your maths are wrong
You are paying it off quicker and therefore have larger repayments each month on the Loan and Mortgage!
This saves the Interest but if you just overpay as and when you can afford this will have the same effect.
Try not to commit to too much of your Income going on repayments each month.
Better to have smaller mortgage/secured loan payments and OVERPAY each month