Borrowing on top of mortgage w/ Nationwide in order to consolidate

matei72

You're right re. the broker. If this falls apart then we'll go that route.


Initially we thought it would be easier to stay with Nationwide and avoid any additional fees/hassles of setting up something new with a different lender, but this is proving to be a bumpy process.


Nationwide's online application is pants, had to do it over the phone. That took quite a while, and then trying to get a face-to-face appt. locally was impossible, no slots for weeks. The next advisor I spoke to on the phone messed up our application (put down we had no card balances, then put the balance of one of the cards down as a montly payment - who makes a £9K monthly payment?!?!).


Finally got an evening telephone appt. only to find out that Nationwide gave me the wrong date.
Re. the debt and our situation - we knew that we'd be assuming quite a bit of debt in the short term, it is/was part of a plan that is peculiar to our situation - so it isn't (thankfully) chronic overspending on things.

Our situation is quite similar to Sunshine London's, we have a very specific situation combined with the added stress of purchase of a house, new child and complications following that, plus wife was on maternity leave.

Also like SunshineLondon, our LTV is still quite low, we have a similar percentage. The increase in our montly mortgage payment would be quite small, and admittedly it would result in a substantial sum if we were to pay it off over 20+ years - however part of the plan is that we'll pay off this mortgage top-up earlier than planned, starting with overpayments in 2020. The early payment penalty on the mortgage (in principal) is relatively small - especially compared with the interest we would pay over 20+ years.

Also by 2020 we will have sold (hopefully) some land we acquired years ago, so that will also go into the pot and would eradicate a huge percentange of the debt. But that is still two years away.

SunshineLondon wrote: »

just to offer a different perspective -we have recently remortgaged for debt consolidation, it was best decision for us and we used a broker who sorted the whole thing out for us fairly painlessly and quickly reasons why we did it:
-after releasing equity we still have over 200k equity in the house and less than 45% LTV
-alot of our debt was not on 0% and ran out 0% offer options
-mortgage payment didnt increase by too much
-our debt was not built up from overspending on stuff, it was most built up due to some very specific circumstances and it was an extremely difficult period for us - debt consolidation wasnt ideal of ofcourse, but it was the right thing for us as, above all, it gave us breathing space and some sanity back! also freed up nearly £400 a month.

the main reason i know it will work for us is the cards were cut up a long time ago and not used, and accounts have been closed. if you will continue to use credit cards/loans then it wont work as your debt will just build up again so do think about this carefully. esp as your debt is all on 0% youre in a good position - how much do you earn per month?

you would probably have found the whole process easier if you had gone via a broker

Silver_Queen

It just seems like a bad idea to me to essentially volunteer to start paying interest on debt that you’ve said you can get another 0% deal for. And an even worse idea to secure it against property. The only upside I see is that it’ll be slightly less hassle than sorting out another 0% deal.

chevalier

Aside from the obvious riskyness of turning unsecured debt into secured, have you put the figures into a mortgage calculator so you can see how much extra interest you would pay? I know you say you will be able to pay alot of this borrowing off in two years' time but alot can go wrong in two years. If you lost your job, would the extra borrowing mean you lose your home because of it?

You seem to be going for convenience rather that financial prudence. so what if it is a bit of a faff moving the money around to a new 0% deal (which you say you are still getting), surely that is a safer idea than securing debt against your home, especially if you are only going to have to do it for two year anyway.

i wouldn't sorry and i think Nationwide are right to query this
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