Sell 2nd home or Credit Card for extension

Barrybaby

Hi, 1st time poster so please be gentle lol.

So we are moving on 1st Feb. The new house urgently needs an extension on the back and I have all the trades planning etc ready to go. It should cost approx £28k...thing is I want to pay for it either two ways.
1. Via 0% interest credit cards. Paying off the balance each Month & chipping it away. £28k on credit cards split between my wife and I minimum payment would be £280 @1%.

2. Sell one my rental property. I have a rental that if I sell now it will give us £61k immediately after taxes to pay for it all & not worry about putting things on credit cards etc. Problem with doing this is it brings in £850 per month rent vs a mortgage of £210 - £640 per month profit. So we would lose the £640 per month profit & the investment but have plenty to pay for the extension & keep some in the reserves.

So it’s sell house @ £61k, spend the £28k for works leaving £33k change for another buy to let / backup or spend a minimum of £281 (minimum of course likely to overpay) on 0% credit cards for the next 8 years and keep the asset.

So just wondering out of those two, what would you do in this scenario?

Bossypants

Apart from anything else, if you're moving in on the 1st of February and you have trades lined up to start immediately after, they are going to want paying well before you can get another house sale through.

Barrybaby

Yep, they’d be paid via other methods til house is sold or via card. I’m buying materials so just paying the labour element, some trusted trades who I used previously

markin

Worse case no rental income for 6 months, can you afford all the payments, £491, If you can get it on the mortgage or a loan is it not easier to take a payment break if you need.

ethank

Don't use credit cards.......

jonnygee2

1. Via 0% interest credit cards. Paying off the balance each Month & chipping it away. £28k on credit cards split between my wife and I minimum payment would be £280 @1%.

Even if you actually can pay on credit card, it's not really what they are for. Your 0% interest deal isn't going to last 8 years, and when you have 28k credit card debt you'll find it much harder to get interest free deals. There's a good chance it'll end up on closer to 20%. If doing on credit, better to take out a long term loan with a steady interest rate.

Barrybaby

We were planning on balance transferring each time to 0% rates as they expire. I’d heard of people doing that before.... guess a loan is a more steady option but it is a set amount at a higher APR.

staffie1

The house you’re buying urgently needs an extension..?

[Deleted User]

Over 8 years I'd look at a personal loan especially if you can achieve the representative APR or close to it. Every time you do a money transfer or balance transfer with credit cards your likely to be charged a fee so the loan route could end up cheaper. Also your plan with credit cards relies on being able to get more transfer offers in the future which can become tricky if you're already maxed out or might not be readily available in the future when you need.

Barrybaby

It’s complicated but yes I need an extension immediately for my business that i work from home in

jimbog

Maybe option 3: Take out a bank loan