High debt - consolidate to mortgage

jimmymac0380

I have a high amount of debt, i've noted it all down and it comes to around £65k over various loans and credit cards. I honestly don't know how I have got myself into this mess, its not like I have lots of nice things nor spent heavily on holidays and such. I think its just spiraled as I try to chase my tail in keeping up with repayments.

I kept it all from my wife but finally confessed to her yesterday and thank god she is understanding and we will look to find a way to work through it.

The question now is how do we go about it? We have a house valued at £240k, mortage with Nationwide has £140k left so my initial though is to utilise that equity. I appreciate that many will say the interest paid and such would not make it worth it but to my mind this is more about reducing monthly payments and getting back on track, I take the interest as my penance!!

The other issue some may question is what stops me from doing it again. Thankfully my wife is excellent with money, notes all incoming and outgoing on her account ,never overdrawn, never has loans or credit cards, its just me thats the useless one financially!

So I have suggested that once we clear this debt I will pay my wage directly into her account, I am happy to no longer have any control over the money and allow her to give me an allowance as such so as to prevent me from doing anything silly again.

Sorry, this is turning into a bit of a confessional here!

My question is more around the mortgage side, i'm happy to be completely open and honest with the bank and go in person to explain everything, is it likely that they would allow the mortgage? Would a broker be a better option to am I more likely to have to look at a secured loan?

enthusiasticsaver

I would not risk your home by putting it on the mortgage. If one of you lost your jobs or suffered with ill health having an increased mortgage is not a good idea quite apart from the fact lenders do not tend to give low rates for debt consolidation remortgages even if approved.

Can you post an soa on here? What steps are you taking to address your over spending?

jimmymac0380

My most key step to addressing the overspend is finally confessing to my wife about the issues and letting her take charge and have full access to all my finances.

I understand the risks but i'm not sure what the alternative solution is

Andyjflet

OK, hold back on the Consolidation, they rarely work. Post an SOA on here.

Then take a look at Dave Ramseys baby steps programme, listen to the podcasts, its working for me.

MovingForwards

But having your wages paid into your wife's account isn't helping you learn and change.

Adding the debt to the mortgage isn't dealing with what caused the debt.

I would strongly urge you to go through all your bank statements and credit card statements for the last few years and see where you are spending money.

Put up a statement of affairs and we will see what can be done.

jimmymac0380

What is an SOA?

I know what the money has been going on, initially a honeymoon and holidays, both of those have been curtailed but thats where it began. From then its all bits, buying on amazon whenever I think I need something, food shops that get over the top. Never tackling the debt and getting loans to pay off minimum payments. There is nothing in there thats of reasonable/highish value as thats what kind of gets me more than anything, all this debt and next to nothing to show for it.

Willing2Learn

jimmymac0380 wrote: »

I understand the risks but i'm not sure what the alternative solution is

Turning unsecured debt into secured debt is a recipe for disaster.

SOA (Statement of Affairs) definitely required. An SOA lists all of your income, expenses, debts and assets.

Just complete the soa online form, remembering to click on the 'format for MSE button' near the end of the form, before pasting into your thread.

patman99

Jimmymac, if you want to curtail your shopping costs, just draw out a fixed amount for shopping. Then, if you pick up more than you can actually afford, you will be forced to decide what is an indulgence and can be put back and what are neccessities and need to be purchased.


That way, you will be in control of your spending a bit more than you are now.
Also, if you have any paid-for TV such as Sky, Netflix etc. then cancel these if you are able to.

Look around the house. Do you have anything that hasn't been used for at least a year?. Sell it. FB market place is free to list on and people tend to come to collect the item so saving on postage.