Can I remortgage?

jmc1984_2

Hi all,

Unfortunately my wife and I have been living beyond our means for some time now and we've both finally had enough and decided to sort ourselves out.

One thing that could be a possibility is to remortgage to pay some of the debt off. We have some equity in our home but with having some much debt we don't know if we can actually remortgage or not. As far as I'm aware we don't have 'bad' credit ratings, just a lot of debt.

Would a mortgage company consider us at all, or is this not something we re able to do?

Thanks in advance.

glosoli

Maybe, maybe not.

What is the value of your house?

What is the balance of your existing mortgage?

How much debt are you actually looking to consolidate?

What are your incomes?

jmc1984_2

glosoli wrote: »

Maybe, maybe not.

What is the value of your house?

What is the balance of your existing mortgage?

How much debt are you actually looking to consolidate?

What are your incomes?

Thanks for your reply.

We think house value is around £100k and existing balance is around £67,700. We're out of our redemption period so no charges if we switch.

Debt to consolidate is around £35k.

Incomes are £17,858 for me and wife isn't salaried but brings home around £900-1000 per month. We also get child benefit for 2 children.

I'm assuming we won't be able to pay all of the debt off based on LTV's etc but of we could pay off some of the bigger ones it would really help put us back on track.

glosoli

There is not a great deal of equity as far as debt consolidation is concerned, generally the maximum for debt consolidation is around 80% loan to value (although may be slightly more or less depending on the lender).

So potentially you could consolidate around £12,300. Essentially you would have a £80,000 mortgage, with further unsecured debts of around £22,700. Based on your income alone, and the child benefit, this might be a struggle to pass affordability checks. You say your wife gets £1000 a month, where does this come from?

I am wondering if debt consolidation is not an option, would it be possible for you to extend the mortgage term, and go onto a lower rate of interest with your existing lender, and then use the savings each month to overpay the debts?