Complicated!
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Not sure if posting this in the best place as it covers just about every financial product.....question is what would you do in this situation?
My main mortgage (on a house I love and want to retain) is £425,000 and due to be paid off in three years. It is interest only with a bank taken over by government that will not extend or refinance in any way. Value around £800,000. I also have £70,000 of other debt, all of which I have personally negotiated (no CAB etc.) with lenders to be interest free, paying off a set sum per month. As interest free no real requirement to pay faster except it has led to a poor credit rating. I have about £100,000 in the bank which I am keeping in the bank (gaining interest and not using to actually pay off the mortgage in case I don't have a new contract and need to dip into it), with a view to pay off mortgage but it is touch and go whether I will continue to earn at the rate I am doing now (I am a contractor working through my own limited company) - if I do I should just about be able to do it; if I don't then I might need to re-mortgage but will have a very poor credit rating. However, if I do pay off the debts I definitely will not have enough for the mortgage. I do have £70,000 in a personal pension and 5 buy to let properties - selling two would bring in around £60-70,000 equity and keeping three which have minimal equity but provide a long term income. Is it best to keep saving as much as possible and throw everything at the mortgage or to pay off other debt and aim to build a credit rating in 3 years? I am early 50's.
My main mortgage (on a house I love and want to retain) is £425,000 and due to be paid off in three years. It is interest only with a bank taken over by government that will not extend or refinance in any way. Value around £800,000. I also have £70,000 of other debt, all of which I have personally negotiated (no CAB etc.) with lenders to be interest free, paying off a set sum per month. As interest free no real requirement to pay faster except it has led to a poor credit rating. I have about £100,000 in the bank which I am keeping in the bank (gaining interest and not using to actually pay off the mortgage in case I don't have a new contract and need to dip into it), with a view to pay off mortgage but it is touch and go whether I will continue to earn at the rate I am doing now (I am a contractor working through my own limited company) - if I do I should just about be able to do it; if I don't then I might need to re-mortgage but will have a very poor credit rating. However, if I do pay off the debts I definitely will not have enough for the mortgage. I do have £70,000 in a personal pension and 5 buy to let properties - selling two would bring in around £60-70,000 equity and keeping three which have minimal equity but provide a long term income. Is it best to keep saving as much as possible and throw everything at the mortgage or to pay off other debt and aim to build a credit rating in 3 years? I am early 50's.
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