Credit cards - Loans and Remortgage

Ashby79

Hi,

Apologies if I've posted this in the wrong forum or if a similar topic has been covered by I could do with some advice with regards to Loans and Credit Cards.

Before lockdown V1 took place we remortgaged our property to add an extension with a 2 year fixed. During this period we purchased some materials on credit cards to the cost of £11000 pounds. (interest free credit card)  Due to building scope creep! The interest free is coming to an end and so is our 2 year fixed. I have a credit card that i could transfer to for 0% 20 months but it has a 4% fee. Looking around I could get a loan for 2.8% for say 2 years. 

We have good credit ratings and intend to pay the credit card of within 2years or less.

So my question is should I take out a loan out for 2 years and pay off the 2 credit cards or should we try and move to  0% credit cards between us.  And as we want to remortgage around June would any of these options effect us remortgaging. I myself already have a small personal loan. So if I did take out a loan i would then have 2 again would that go against me. 

I'm worried about making the wrong financial decision for us. 

Thanks  

Ash

[Deleted User]

You have enough time to refinance, but you may struggle on affordability. Your good credit ratings aren't taken into account by lenders and your cards and existing loan may make further borrowing difficult.

Try some eligibility checkers, compare the costs and establish your realistic options.

Ashby79

Thanks zx81 thats what has been concerning me, I have used eligibility checkers and taking a loan out seems to be a safer option but is it risky me having 2 loans on the go when remortgaging does that reflect badly on us?   

Brie

The bank may be concerned that you have a mortgage and a loan and a huge amount of unused credit available to splurge on shoes or toy boys.  And frankly I don't think there's much to be saved by a 2.8% loan over 2 years as opposed to a one off charge of 4%.  

Ashby79

Hahhaha a good point thanks Brie. I would prefer to use the credit I have instead of expanding to more. 

DrEskimo

There's no guarantee you will get offered 2.8% APR of course. With the existing £11k debt, on top of your existing personal loan you may be considered higher risk and only be offered a much higher rate.

sammyjammy

Is your plan to move to a new fixed rate or will you be changing terms/amount borrowed on your mortgage?  If terms and borrowings are to remain the same just do a product transfer with your existing lender.