Mortgage with High amount of debt

csgohan4

Mortgage_Adviser wrote: »

Your comment is based on assumtion that OP will be continually dragged in debt and the problem spirals.


My comment is however based in a disciplinned debt repayment.


If you look purely at what is cheaper to repay a credit card with the balance of 20k and the interest of 20% over say 5 years or to repay a mortgage with a rate of 1.5% the answer is obvious.

I don't disagree it's cheaper, however not all lenders like to lend more for debt consolidation and for very good reason.

The lender can only go on track record and it doesn't look good for the OP with that amount of debt and no sign of paying it off soon.

Whether the OP can get a sizeable remortgage is a different matter with that debt hitting affordability as well

Malbac78

I appreciate all the comments and the advice. But what I really want to know is if it is possible to do this? We are in a really good position in that we own our own home outright at a value of £450k. This was through hard work and some shrewd investments in the past. We have done very well with this. I'm sure there aren't many people at the age of 35 who have done this. Yes we have made mistakes, and in hindsight (which is a wonderful thing) The home improvements we have done should of been paid by remortgaging the house. We earn over £60k a year between us and what we want to do is have a bit of a easier life with our outgoings. It is currently very hard to pay off any more of our debt as we are paying out so much leaving us with little each month.

ACG

Malbac78 wrote: »

I appreciate all the comments and the advice. But what I really want to know is if it is possible to do this? We are in a really good position in that we own our own home outright at a value of £450k.

You will be fine.

[Deleted User]

Debts that will be repaid shouldn't hit affordability at most lenders so if your credit is OK (as stated above) then agree with ACG you should be fine.

Before speaking with a broker, I'd check your credit reports just to be sure nothing is incorrect (Statutory Reports only). You don't want to do the leg-work, apply, find an error and have to wait for it to be corrected etc.

The non-home improvement debts you obviously do need to think about to avoid in future (as csgohan4 has said) but ultimately you should manage to save a hefty amount each month once you get your mortgage, to prevent this happening again.

Jmaho

Someone will lend. The debt to be repaid won't be included in affordability but debt to income is 100% and as an Underwriter for a large high Street bank I'd be questioning lending given the fact you are mortgage free yet have accumulated debt of 60k

getmore4less

Classic consolidation conundrum.

If you can account for the debt on projects(not LBYM) and have a proper budget/plan to manage future spending and projects it should be OK.

That include saving up to buy stuff once current cash flow problem is resolved.

Car cost to earning ratio of the oh looks seriously out of balance.