Owe 70k, options

Sly72

Exodi said:

Sly72 said:

Would be surprised if you can get any 0% balance transfer/money transfer cards. Best let them all default and set up your own DMP, then defaults clear in 6 years time.

sammyjammy said:

Misc11 said:

Thanks however if I clear any debt, that associated debt has all adverse data removed. I do not have to wait 6 years.

Thats not true, if there is adverse info on an account it will remain until 6 years after the debt is repaid and the account closed, if a default is registered then the account is removed six years after that date whether the debt has been repaid or not.

Did either of you read the OP?

@Misc11 In theory yes, though I'm not sure what you mean by "refinance bad debt if I can and apply for a mortgage".

I'd hope that the intention of 'refinancing' to 0% was to clear the debts quicker and then apply for a mortgage with a clean state, not to think "yes I have a mountain of debt, but it's not a big deal because it's all currently 0% so can I have a mortgage please" - hopefully that's not what you meant?

I did but surely the debts appear on OP's credit report, so when applying for new credit OP's credit report would be taken into account as no info on the FOS decision would but viewable and they would not know.

Exodi

Ahh so it was the latter as I feared. So the actual reason for shuffling the debt around is to try and isolate it all to one CRA (because obviously there's not much financial sense in refinancing your existing 0% debt with new 0% finance, more likely the opposite as the new lender will not not offer 0% forever).

My guess is the actual end goal is try and get a mortgage with a potential lender that doesn't check with the credit reference agency you've isolated all your debt with (but I think this is a non-starter as you'd need to also declare in your application you have no debt, which would be fraud). Otherwise it doesn't really make much sense to me why you'd bother moving the debt all round the houses, unless I've misunderstood something.

Personally, and I think this will be the general view, you should just focus all of your energy on clearing all of the debt as soon as possible (especially as it's 0%) and then apply for a mortgage with a blank slate. 

Misc11 said:

All debt has no interest on it as a result of my FOS case. I'd agree yes 70k is a mountain, however if I pay some of it off, I'd be refinancing about 25-30k. Considering my income, I don't see that as a mountain. It's all relative.

The counter to this commonly used argument being - if you see £25-30k as being relatively insignificant considering your income, then it shouldn't be a problem clearing it.

Exodi

Misc11 said:

All debt is 0%, forever.

OK just seen this, I can not for the life of me work out why you would want to refinance the debt, except to try hoodwink a mortgage lender.

Misc11

A slight misunderstanding, I wouldn't apply for a mortgage with any adverse credit. I know most mortgage lenders check all CRAs.

I want to pay off the debt thats only appearing on equifax. Apply for 0% credit card, pay off the remaining adverse credit with that and savings.

My credit file would be then clear of adverse but have some debt. 

Then I can apply for a mortgage.

Misc11

So I can get a mortgage sooner 

Exodi

Misc11 said:

A slight misunderstanding, I wouldn't apply for a mortgage with any adverse credit. I know most mortgage lenders check all CRAs.

I want to pay off the debt thats only appearing on equifax. Apply for 0% credit card, pay off the remaining adverse credit with that and savings.

My credit file would be then clear of adverse but have some debt. 

Then I can apply for a mortgage.

Oh thank you, I finally understand. In theory yes (I can't say in practice because your FOS arrangement is rather unique, at least I haven't seen it before).

I'm clear now that you'd be declaring the £25k-£30k to the mortgage lender, it just wouldn't have the adverse credit history currently behind it while it remains with the defaulted lenders.

Presumably you have a deposit (from earlier comments you mentioned putting £2k to debt and £1.5k to savings per month) so if I was a lender the first thing I'd think would be why you don't use the £XXk of savings to pay off the debts, but I guess your view would be that it's 0% so what's the point paying more (and you want to buy ASAP).

I would remove all the confusing (and relatively irrelevant) background details about CRA's and the FOS and re-post this thread on the mortgage board to be answered by one of the many mortgage brokers who frequent it.

Framed simply as:

I earn £180k per year, I have £XXk of savings and I have £25k-£30k of debt. Could I get a mortgage and for how much?

(assuming you are confident your credit report would be totally clear)

It may be that lenders require you to pay off the debt as a condition for the mortgage in any case, so you don't need to mess about moving it around the houses.

Misc11

Ok thank you

ben-dover

I'm not sure why you're not just paying off the debt as soon as possible if you're on £180k per year. Assuming you're salaried, that's over 9k per month. 

Now not knowing any other details, such as kids, current housing situiation, where you live atm etc it's hard to give any advise, but I'd have that lot paid off in the year. 1 crap year, no holidays, move back in with mom and dad, buy a caravan, 

Every month 6k debt paid off. 

Misc11

Not as easy as that unfortunately,  kids and childcare to pay for. Otherwise yep absolutely would be doing this 

ben-dover

Misc11 said:

Not as easy as that unfortunately,  kids and childcare to pay for. Otherwise yep absolutely would be doing this 

I fully appericate that, Good luck.