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After a bit of advice

Penguin_
Penguin_ Posts: 1,594 Forumite
Fifth Anniversary 1,000 Posts Name Dropper
in Mortgages & endowments
HI all!!
So after a little bit of advice as I am thinking mid to long term.
I own a house which has £78k mortgage currently (74.2% LTV) & am coming up to the end of my initial 5 year fixed, no missed payments or anything.
Got myself into debt which I am currently paying off via Stepchange but the amount is £12k, I know!! But I am chipping away at it slowly. I am the only person earning in the house, as I am a single Dad. Anyway, I have met someone & this has made me think about what might happen in the future if we wanted to get a house in the future.... 
Is the mantra to keep paying away at the DMP rather than re-mortgage next year & pay off the DMP? Or would I be better off just moving to another fixed deal with my provider & continuing to increase the equity in the house so if we ever did come to buy a house together, I would have a good chunk for a deposit?

Comments

  • Sistergold
    Sistergold Posts: 2,137 Forumite
    Sixth Anniversary 1,000 Posts Name Dropper Photogenic
    What is DMP again? A 2yr deal is not a bad idea. It might even be a 2yr deal which is not fixed and no early repayment charge meaning you can sell or anything else anytime. 
    Initial mortgage bal £487.5k, current £258k, target £243,750(halfway!)
    Mortgage start date first week of July 2019,
    Mortgage term 23yrs(end of June 2042🙇🏽♀️), 
    Target is to pay it off in 10years(by 2030🥳). 
    MFW#10 (2022/23 mfw#34)(2021 mfw#47)(2020 mfw#136)
    £12K in 2021 #54 (in 2020 #148)
    MFiT-T6#27
    To save £100K in 48months start 01/07/2020 Achieved 30/05/2023 👯♀️
    Am a single mom of 4. 
    Do not wait to buy a property, Buy a property and wait. 🤓
  • MovingForwards
    MovingForwards Posts: 17,164 Forumite
    10,000 Posts Seventh Anniversary Name Dropper Photogenic
    Never turn unsecured debt into secured debt, especially when (I assume) all the interest on the debts has been frozen due to being in the DMP.

    Also, you will need at least one clear year after the DMP has finished before being able to secure a mortgage.

    Fix another deal with your current lender, it generally takes a few minutes online to do. 

    Keep building the equity up in the property and any spare money you have, put it into a savings account with a view to clearing the DMP early.
    Mortgage started 2020, aiming to clear 31/12/2029.
  • Penguin_
    Penguin_ Posts: 1,594 Forumite
    Fifth Anniversary 1,000 Posts Name Dropper
    OK thanks both, I thought that was the best method of doing things. Just wanted to get opinions I guess.
  • withaspritz
    withaspritz Posts: 254 Forumite
    Sixth Anniversary 100 Posts Name Dropper
    edited 24 September 2020 at 10:02AM
    You might want to check as most "mainstream" lenders won't accept people who have a DMP in progress (https://www.expertmortgageadvisor.co.uk/bad-credit-mortgages/mortgage-with-a-debt-management-plan/)
    Specialist lenders via a broker should be able to help but it might need a proper chat with a financial advisor / mortgage broker first
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