Remortgage for debt consolidation

Smithy45

Hi, I'm hoping someone can help me here.
My current mortgage deal is coming to an end therefore I am searching for a new one. The amount required for a mortgage is £128k and the property was valued at £160k 2 yrs ago. Therefore at the moment I have 20% equity and need a mortgage at 80% ltv.
However.... I have credit card debt of £10.5k which I need to get rid of as they are also coming to the end of their 0% interest rate and had naively assumed I would easily be able to add this to a new mortgage in order to consolidate my debt.
So far I have found that most lenders are reluctant to do this in cases of over 80% ltv and I am becoming worried that I am going to get in a real mess!:(
Firstly.... Has anyone else recently found themselves in this situation and found a lender who will let them borrow up to 85-90% ltv for debt consolidation??
Another option is trying for a loan to clear my credit card debt and have found a suitable one but I am now wondering......how will this affect my credit score so close to the mortgage needing renewed (1mth), or will the fact that my monthly outgoings are more because of the loan affect my success with the mortgage application, or will it actually improve my chances having removed the credit card debt. It's difficult to know what to do for the best, and any advice will be greatly appreciated.
Many thanks:)

foxy-stoat

Many lenders will not be happy for you to pull equity out of your home above 80% LTV, debt consolidation will have tighter restrictions.

Your better off trying to get a new deal with another credit card provider, but out of interest, how much was the original balance transfer and how much have you cleared within the 0% period?

If you insist on getting a loan then wait until you have re-mortgaged and then try and find a low rate loan - you may struggle as you will not be offered the highline rate for debt consolidation.

cahillg81

There are lenders who will do this, you probably need a good broker to get you through the process though.

Pixie5740

Whoa, why turn unsecured cc debt into debt secured against your home? Not to mention pretty expensive debt if you're going to take 10+ years to repay it.

Have you tried applying for another 0% credit card and doing a balance transfer? If you can't get another 0% card then it might work out cheaper just to repay the cc with a higher interest rate over a shorter period of time compared with a lower interest rate over a much longer time period.

cahillg81

Sound advice Pixie but I guess from the OP it's about reducing the monthly outgoings.

Smithy45

Foxy-stoat, thanks for your reply. There was no original balance transfer, I started the debt on both the cards and have only paid the minimum payments since........dreadful I know and gonna pay for it now I think! If I got another 0% card to pay off the other cards, would this not affect my credit score more so than the loan? the problem with waiting until I have the mortgage before I get the loan is that I might not be able to borrow enough to cover the mortgage unless the credit card debt is gone! Or so I have been told be HSBC.
Cahillg81, do you know which lenders? Does the broker need to be local to me (Edinburgh) or is an online broker an option?
Thanks so much guys )

Thrugelmir

Smithy45 wrote: »

Foxy-stoat, thanks for your reply. There was no original balance transfer, I started the debt on both the cards and have only paid the minimum payments since........dreadful I know and gonna pay for it now I think!

Lenders will see this too. CRA's now track promotional credit card deals and whether people only make the minimum repayment. While debt consolidation provides an answer it's not the solution. While your outgoings are reduced. You'll end up paying the debt back for far longer. If you haven't already done so. Take a look at the Debt Free Wannabe forum. Plenty of support and advice on there. With many people taking on the challenge of reducing their outgoings to tackle the debt they owe.