Additional borrowing for debt

jamesp31

Hi. I’ve just spoken to my lender about additional borrowing. I want to pay off a 15k debt to a family member but the most they would lend for debt consolidation would be 12k and as it wouldn’t pay the debt in full they said no. My question is this. Was I too honest in telling them the reason for wanting additional borrowing? Eg if I had stated I wanted to buy a new car worth 15k, what proof would they need? And I guess, is lying to the lender about the use of the money a bad thing?

Please help

Thrugelmir

£12k may be the maximum amount that they are willing to advance irrespective of the reason given.

[Deleted User]

speak to a different lender?

'Was i too honest?' - Wtih financial matters, this question is black and white. Its a case of 'Should I tell the truth, or should I commit me some mortgage fraud'

jamesp31

Deleted_User wrote: »

speak to a different lender?

'Was i too honest?' - Wtih financial matters, this question is black and white. Its a case of 'Should I tell the truth, or should I commit me some mortgage fraud'

I’m halfway through a 5 year fix, so another lender isn’t an option

MovingForwards

Bank loan?

[Deleted User]

jamesp31 wrote: »

I’m halfway through a 5 year fix, so another lender isn’t an option

of course it it. Its just not an option you want to take.

2nd charge
Personal loan
remortgage and pay the erc

choose one or wait until your 5yr fix is up

jamesp31

I’d love to just remortgage especially as rates are so low, I’ve looked at remortgaging and I could get a much lower rate, borrow more and still pay not much more per month than I do at the moment. But I have a 4% erc to pay so no point. I’m laying £200 per month to a family member for a loan they took out to clear my debts, I still owe them 15k. I was hoping to get additional borrowing to reduce my monthly outgoings as £200 a month is a stretch for me, if I could pay half that we as a family would be so much better off. A bank loan would be too costly per month, that’s why I was looking at additional borrowing

[Deleted User]

2nd charge until your erc expires and then remortgage the whole lot to a cheaper deal?

djphig

Agree with JMA - 2nd charge is probably a good way to keep the payments low depending on equity available in your property. Term can be run for up to 35 years depending on lender and plenty of products available without any early repayment charges so you can remortgage the whole lot when your fixed rate expires

jamesp31

So can I just check, a 2nd charge, can that be with any lender?

Thrugelmir

Will more than likely be a secondary lender. Extending payment over a long term could be an expensive option. Short term benefit of reducing your outgoings could be short lived.