Advice please

razor1981

I have £87k mortgage
I have £41k on credit cards, some are now starting to come off 0%
I've previously consolidated debts before on our last remortgage and i'm being told we can't do again until 2023.
Our house value is roughly £300k.

I think ideally it would make sense to shift debt on to the mortgage as the rates would be the cheaper but may not be allowed.

Please can knowledge be shared with me and any helpful guidance would be appreciated.

The lifestyle change has happened so no more credit card usage will occur.

Rough monthly figures are £:
Income - 2,850
Bills - (383)
Mortgage - (326)
Food and other - (844)
Credit card requirements (780)

This leaves around £500 at the moment but now as % credit card offers are drying up extra payments will have to made from this.

TIA.

sourcrates

Hi,

You’ve shifted debt once, now you want to make the same mistake again ?
That doesn’t make sense does it !!

Post up an SOA and we’ll see where savings can be made, but your most likely looking at debt management, further borrowing is never the answer, as you have found out.

shiny76

What term is left on your mortgage?

Shifting CC debt onto a mortgage should reduce the monthly cost but if you're paying that over a significantly longer period then the total cost of the interest could be substantially more

razor1981

28 years is remaining.
Looking to reduce the monthly outgoing until my partner returns to work.
When both are working then look to make annual payments and further remortgaging when renewals are up.

-taff

Right now you've been told you can't remortgage and consolidate that way so that option is out.
If you have 28 years left on the mortgage, you could sell your house and pay off the debt that way and be left with roughly 150k to buy another house with. Of course, if your partner is out of work getting another mortgage may not be so simple.
Post your full SOA.

EssexHebridean

OK - you have previously consolidated debt onto the mortgage. That now means you will be paying off that debt for the remaining term - remember you still HAVE that debt, it's not gone away, you've just hidden it from view.

While the mortgage rates might be cheaper, the length of time over which you'll be paying off almost certainly mean that you will be paying a much higher amount over time - don't lose sight of that.

You now have a further £41k in debt - I'd suggest that the bigger question here than "how to pay it off" is "where did it come from and what steps am I taking to make sure that doesn't happen again?" although your comment about lifestyle change does suggest that you might already have done this. I'd also say the fact that you've been turned down for further borrowing on your mortgage at this point should act as a bit of a warning klaxon for you - down the line you will most likely see that as a good thing.

DON'T sell the house to pay off the debt - allowing that you currently say you have a surplus that would be incredibly foolish.

Have you checked to see if you are eligible for any further 0% deals that you could perhaps balance transfer on to? As already said a full SOA would be a good thing to do - that will give you a proper slid working budget.

-taff

By the way, I'm not saying that that's a good option, it's just an option. If you haven't taken charge of your finances before, it's as well to start with that rather than hiding it away as Essex says above.

middleclassbutpoor

Dont consolidate, learn to live within your means and get a proper budget so every £ you earn has a job - which most of them should be repaying the debt.

If you are not careful, you will get a lightbulb moment when there is no more equity, or even worse no more home.

monetxchange

A full SOA would help us advise. There’s no way out of this but seriously knuckling down and starting to tackle this debt. It will only increase if you don’t grasp it now or try to push it sideways again.

What’s the £800+ for groceries and “other” things? That’s a huge spend after bills. It would indicate to me that there’s some trimming to do on your budget still. Make that lifestyle change stick!

Bookgal88

Agree with monetxchange - food and 'other' is the category that looks like it needs some work at first glance.

Balance transfer to a 0% credit card would initially seem like a good way to tackle it, but that also needs to be done sensibly.

I don't want to be mean, but you reallllly need to have an honest conversation with yourself (and your family) about how and why these debts have been able to rack up on more than one occasion. Because unless you get to the crux of that issue, it's more likely that you'll be finding yourself in this position time and time again.