Remortgage and credit cards

marie_82

I have a fair amount on credit cards and am starting to get worried about remortgaging around March next year. 

My cards are well managed and all are no or low interest and I have most set up to be gone by the end of interest free or low periods which means I am paying a fair bit but it’s affordable and I hate paying interest! 

My question is should I be reducing my minimum payments in the approach to remortgaging to help my affordability or will they be able to see that I have been managing ok as they are? Or will it be enough for me to tell them I have been paying more than I need to be and if it became unaffordable I could reduce? 

[Deleted User]

marie_82 said:

My question is should I be reducing my minimum payments in the approach to remortgaging to help my affordability or will they be able to see that I have been managing ok as they are?

You can't reduce your minimum payments as they're exactly that -  the minimum you can pay. Increase payments on any interest bearing balances unless you're earning more in savings.

The debts will impact what you can borrow, but it all depends on the numbers as to whether that's a problem for you or not. For instance, what's your LTV?

aoleks

credit cards are taken at 3% of total outstanding balance. £10k would be £300 per month in affordability, might not be the end of the world.

JJG1984

I moved into my first home on a two year deal then spent £21k on interest free to furnish; I don't struggle with the payments and I also over pay £150 a month on my mortgage but affordability is all about disposable income and my broker has advised unless I drop it significantly then a product switch with the same lender is a better option

as its going to take 3 years to clear even with a good credit rating and able to keep bouncing to interest free deals 

marie_82

Deleted_User said:

marie_82 said:

My question is should I be reducing my minimum payments in the approach to remortgaging to help my affordability or will they be able to see that I have been managing ok as they are?

You can't reduce your minimum payments as they're exactly that -  the minimum you can pay. Increase payments on any interest bearing balances unless you're earning more in savings.

The debts will impact what you can borrow, but it all depends on the numbers as to whether that's a problem for you or not. For instance, what's your LTV?

Hi sorry I meant should I reduce it to minimum as I am currently paying much more. My LTV is probably below 50% but I am earning a bit less than when I last remortgaged and I obviously have these debts now as well. 

marie_82

JJG1984 said:

I moved into my first home on a two year deal then spent £21k on interest free to furnish; I don't struggle with the payments and I also over pay £150 a month on my mortgage but affordability is all about disposable income and my broker has advised unless I drop it significantly then a product switch with the same lender is a better option

as its going to take 3 years to clear even with a good credit rating and able to keep bouncing to interest free deals 

So if I just switch with the same lender to a new deal are they less strict? My understanding I got was that they all have to do the responsible lending checks? 

JJG1984

marie_82 said:

So if I just switch with the same lender to a new deal are they less strict? My understanding I got was that they all have to do the responsible lending checks? 

I was advised that no affordability with a product switch with the same lender 

justcat01

When we remortgaged last year, we had a load of credit card debts. We were able to remortgage with the same lender to a much better rate immediately. They didn't do any credit checks or anything. The switch was accepted straight away - same day as application

aoleks

on a similar note, is a product switch the same as re-mortgaging? can I opt for a new promotional fixed period again or is it something else? if your bank happens to be the cheapest atm, are you saying that you can get the best offer on the mortgage without going through the process?

justcat01

aoleks said:

on a similar note, is a product switch the same as re-mortgaging? can I opt for a new promotional fixed period again or is it something else? if your bank happens to be the cheapest atm, are you saying that you can get the best offer on the mortgage without going through the process?

Yes, I believe it is the same. We went onto the best rate they had for our LTV