Debt consolidation using your mortgage

slightlyslumped

At the moment my credit card monthly payments are around £420 a month. Total debt is £32000.

Spoke to mortgage provider about adding £32000 to my mortgage and then paying off the cards. I know long term this will cost more, but short term this will add £160 a month on to my mortgage (saving me £260 a month). This would be over 30 years but hope to have this portion of the mortgage paid off in 15 years.

Problem arises in of the six cards I have, four of them are not charging interest at the moment due to recently being transferred. According to my mortgage provided the FCA won't let me transfer these cards as I might be able to reduce this debt before adding to my mortgage (and thus saving me from a higher payment in the future). Without these other four cards, I'm only transferring £12k and the whole thing just isn't worth it in that scenario.

Does this sound right? Hadn't heard of this FCA regulation, apparently from April 2014.

Looked at other loans but they weren't as low as adding to mortgage.

I am thinking my only solution is to transfer my four no interest cards to cards that charge interest and then going ahead with the changes to my mortgage. But then if for whatever reason I don't get the new mortgage deal I am stuck with interest on credit cards.

Any ideas?

Thrugelmir

Simplifying your post. Your issue is your total unsecured debt. Lenders under the regulatory requirements of the MMR (April 2014) have to assess affordability when making a lending decision.

Suggest you start with the Debt Free Wannabe forum. As the onus is on you to tackle repaying your debts. Majority of lenders will be reluctant to consolidate debt of this magnitude.

slightlyslumped

Would a moderator kindly move this to the debt free wannabe forum please? I'm new here and don't think it's an option I can edit.

getmore4less

Why would you move cards that are no interest to interest paying?

Do a SOA and review you can get this under control,

£32k £160pm over 30 years is 4.4% quite high for mortgage rates.
to pay it off in 15 requires £245pm

review your current mortgage, might have to stay with the same lender but if you can squeeze that will free up some cash for the other debt.

Since you allready have £20k interest free, focus on the other £12k look up snowballing debt but watch for them coming out of the interest free period(not realy interest free if there were BT fees).

-taff

Changing unsecured debt into secured debt is usually a terrible idea.

What you have to tackle is why your spending on credit cards was or is so high. If your circumstances haven't changed and you're still spending on them, your debt will just increase again.

Yep, go to the debt free wannabe board, and ask for help there. You'll probably be aked to post an SOA, and work out what you're actually spending money on and ways to save it.