Terrified and need advice on debt

enthusiasticsaver

I would not normally recommend absorbing credit card debt into your mortgage but since you have done it can I strongly suggest you stop using credit cards going forward to avoid the temptation of you putting debt on them again. 

sourcrates

I second the above, cut up those cards and close the accounts down, because consolidation all of a sudden leaves you with large amounts of available credit, again, and the temptation to use that credit will intensify over time if you don`t close it all down.

Its a recurring problem we see on these boards sadly.

tigergambit

torgirl21 said:

Sorry it's been awhile since I posted but I wanted to thank everyone who took the time to comment..it was much appreciated. I realised my broker had been less than helpful so I found another one who has been brilliant. I've managed to secure a new mortgage deal which incorporates my credit card debt and the monthly payment is less than my old mortgage. I feel a real sense of relief and plan to overpay my mortgage as often as possible to bring down my debt as quickly as I can.

The vital lesson I learnt from this forum is that there is always a path out of debt one way or another. I came here panic stricken and feeling hopeless but the helpful comments made me realise I had options and gave me the confidence to go and explore what those were.

Many thanks for all your help

Well done on getting this sorted out. Adding debt onto your mortgage is seldom the best thing to do but as it has been spent on renovations which will add value/equity I think it's acceptable in this case. 

Get rid of all cards except the one with the smallest interest rate (for emergency use ONLY) and before you start overpaying you should use any surplus you have to build an emergency fund. Once you have a goodly amount in there (at least 3 months expenses) you can close the last card and consider overpayments.

I'd still consider renting out your spare room as it's one of the only ways of getting some tax free cash. Don't forget that it is you who chooses the tenant. Even if you only do it for summer months it could be very worthwhile. 

Good luck with your journey!

TG