income/debt

Rog4632

 Hi all, I was wondering what is better to pay off.

BarelySentientAI

One of those things is a size of debt, the other is a rate of repayment.  How are you comparing them?

Brie

My bet is that the cards are charging more interest than the loan so I'd be hitting those first.

But if you are talking about getting another loan to pay off the credit cards this is not recommended.  It's known as a consolidation loan and would be obvious on your credit report that the banks will be looking at to grant you a mortgage.  Also - there the huge problem that if you haven't dealt with your debts and learned how to budget then chances are you'll just start using the cards again and you'll have loan 1, your new loan and lots of money owed on the cards.  

Better to pop over to the debt free board and look for the statement of accounts (SOA).  Fill that out and you can see how much you are spending on what.  You might post it on there and get some good advice from the friendly people who will help you find ways to deal with the debts and leave you in a better state come mortgage time.  

ACG

General rule of thumb is that lenders assume a repayment amount of 3% of the balance on credit cards, on £7k that is £210 pm. With a loan they use the repayment amount.