Add credit card debt to mortgage?

enthusiasticsaver · 19 July 2019 at 4:31PM

How far have you got with your mortgage application and what is the cost of the new house? Does the lender know you have existing debt and what have they said about it? I think you will find it easier to get an offer with the lower amount. It will also be more affordable. Lenders always work on the principle that you will not repay the existing debt so adding £9k to your mortgage to pay off the interest bearing cards will lead to them assuming you want a mortgage of £166500 plus the existing £15k of credit card debt. That is because people who consolidate debt often do it more than once and then build up debt again because they have not learnt to live within their budget. That is the priority.

natc · 19 July 2019 at 6:50PM

Thank you.

We have paid for the application fee, the broker has confirmed affordability, it's with the underwriters now. We have applied for 90% but can always reduce this to 85/80%

The new house is 185k. It's workingout at £740 per month on 90% ltv, 3.77% interest rate. It's 3.6% on 85%

WhenIam64 · 19 July 2019 at 8:49PM

You'll be paying stamp duty (2% on £60k) plus legal fees of about £2K - so an additional £5k to be financed over a period. Financially it doesn't stack up but it never does when moving. It's an emotional decision rather than a logical one.

You'll just have to take it on the chin and save like mad over the next few years. We've all done it.

All I would suggest is that with the LTV element being so tight that you have (worthwhile) payment protection / ill-health cover.

Add credit card debt to mortgage?

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