How will 7k debt affect remortgage

united4ever

Started a mortgage when we bought house last September. 150k mortgage on 250k house. It was a 3% fixed for 2 years with NatWest. About 6 months ago I bought a car for 7k on a credit card 0% for 15 months and have only paid a bit of it off.

Next year I am going to be looking to remortgage. How will this 7k debt affect this if I can't reduce it much in the meantime and just shift it onto another 0% credit card.

I earn around 33k a year, wife does bits of teaching and gets about 5k but is effectively a zero hour contract so maybe they wont use her income. We have 2 kids 4 and 7 years old.

Want to try to get the debt cleared asap but it may not be doable in time for remortgage. Also, when should I start looking for mortgage offers for a remortgage....3 months before or do offers last longer than that meaning I could look earlier?

Thanks

lee111s

Put your figures into a calculator of the lender you're wanting to remortgage too and see what it comes back with them potentially lending you?


Have you considered staying with your current lender and just switching products when you come to the end of your current fix? There's no affordability checks done if you go down this route.


Alternatively, could you pay off the loan earlier or overpay the mortgage to bring down your LTV?

Malmo

If you want to stay with the current lender, ask about their customer retention products. This will avoid the affordability and credit checks. It's not a remortgage unless you are moving to another lender or looking to borrow more from your current one.

united4ever

Thanks, hadn't thought about stying with them (it's the Natwest by the way). I think I will be below the 60% LTV ratio anyway (I was when I took out the mortgage anyway) but not below 50% so I don't think the LTV will be a factor. No affordability checks means they won't need to know about the 7k on a credit card? Also I would deal direct with them with no broker, is that right? Thanks again:)

lee111s

I don't think there's any benefit of cheaper rates once you're under 60% LTV anyway so if you're below that, great!


That's right, retention products as they're called are simply keeping the loan amount and the term of the mortgage the same but fixing for another X amount of years. Lenders don't carry out any affordability checks when you do this. Most lenders allow you do it online, it takes about 15 minutes to do usually.