Looking to remortgage and *hopefully* consolidate debt. Is 0% interest classed as debt?

socksthecat

Looking for a bit of advice, as we have a fair amount of credit card debt that we’d now like to consolidate to our mortgage. At present, it’s on 0% interest and when I previously asked my current lender if I we could consolidate half way through our 2 year term, they said that due to the fact it was on a 0% term, they would not consider it as a debt, so not possible.
We’re now due to come out of our term in November, and typical that our 0% rate comes to an end in October. I’m now unsure wether to balance transfer the debt to another card we have with no balance and a 0% offer, or suck up the interest we’ll be charged, as a new 0% balance may affect our eligibility for a new mortgage and debt consolidation.
The reason for this debt has been our circumstances, where I worked term time only, due to not having childcare locally to us, so a low income. Our children are now of an age where we do not require me to work this way, so my earnings have increased. We both also have good credit ratings with no missed payments etc.
If we can’t consolidate the debt, we can afford it, but would rather not have the bother of it. 
Our house is worth approx £235,000 and we owe about £112,000. The total debt is around £25,000 (please don’t judge as I know it’s a horrendous amount of debt, but we’re not struggling to repay as I said...just sick of the 0% interest balance transfers)
Any advise would be good, as ideally getting rid of this debt would be great going forward..I’m not sure what lenders are doing now with the uncertainty of our country at the moment. On the one hand, I think we look a safe option with plenty of equity, on the other; a liability.
🤔

Thrugelmir

Have you paid a visit to the Debt Free Wannabe Board? You may struggle to consolidate debt in the current economic climate with the mainstream mortgage lenders.  
Consolidation of debt is rarely the solution. The answer lies elsewhere. 

monetxchange

Putting unsecured debt like credit cards onto your home as secured debt is not a good idea - it then turns into something that puts your home at risk. Lending is very hard at the moment, especially with debt. Consolidating just pushes the debt sideways and many end up running it up again and then are saddled with twice the amount.

Definitely visit the DFW board. I think you first need to look at why you tried to consolidate before, haven't made any in roads into paying down the debt and are now in the same position. £25k isn't that horrendous, but you do need to face up to coming up with a tight budget and plan to get it paid off.

ACG

Which lender said they dont class 0% debt as debt? I think you have been mis-informed but I wouldnt mind checking it on monday. 

If you keep the 0% transfers going and are paying the minimum repayments you are going to be there forever and a day paying it off. Could you not keep your payments at an amount you can afford in order to clear it sooner? 
You should be able to consolidate the debt, but it will take you the term of your mortgage to clear it off - 20 years? If your happy with that, thats fine. 

[Deleted User]

Lenders will class the 0% as debt but certain mortgage brokers wont.  For instance i wouldn't put a 0% credit card on your mortgage as i would never be able to justify it unless your bank statements showed you near i solvent.  My compliance team just wouldn't allow it.

Other brokers work with compliance that doesn't care about it and others work in a way that they get to set their own rules. 

So you could probably do it but whether it is the best advice is another question altogether 

DiamondLil

socksthecat said:

If we can’t consolidate the debt, we can afford it, but would rather not have the bother of it. 
Our house is worth approx £235,000 and we owe about £112,000. The total debt is around £25,000 (please don’t judge as I know it’s a horrendous amount of debt, but we’re not struggling to repay as I said...just sick of the 0% interest balance transfers)

Forgive me - I'm not judging, but this seems contradictory. If you can afford the debt, why aren't you paying it off ?  You say you're not struggling to repay, but in the same sentence you are "sick of the 0% interest balance transfers" which would imply that you can't afford it ?

Perhaps spend a couple of years hunkering down and try to pay a good amount off before looking at remortgaging again when you'll be in a better position ? Re-mortgaging won't be getting rid of the debt - you'll just be paying it over a much longer term and paying interest on it too.

As others have said, visit the debt-free wannabe board.