Repayment to Interest Only

WellKnownSid wrote: »

By my calculation that's almost £40,000 of unsecured debt - plus £16,500 on a second charge. £1,640 of contracted monthly payments, excluding the mortgage but including the second charge.

With £12,500 on credit cards - that's £550 ish. Even if you could double that it to £1100 it could take you close to two years to pay them off. It's not going to happen in a 'few months'.

Taking an interest-only option at this point is simply moving the deck chairs around - I cannot see it having enough of an impact, only increase the risk.

I can see where you are coming from but I am not looking at clearing all the debt while on Interest Only. Depending on how much that saved me I was looking at being able to clear 2/3 credit cards in a few months and reduce my monthly outgoings by whatever the monthly payments were on them. Then I could either look at going back to a repayment now I had some breathing space or add the CC's monthly savings to what I am saving on IO and plough that into another CC.

I do understand the fact I am using money that was paying off my mortgage to now pay into unsecured debt would not be good but the upside is it is doing it above board and reducing my unsecured debt. If this means over the next say 6 months I am not reducing my mortgage then so be it as I am looking at the longer terms plan which helps me avoid defaulting on any payments which could result in mt losing the house

ViolaLass wrote: »

6%?

If so, interest only would save you £165 a month (minus the fee and any fees for changing back).

That would be about right.

I have manged to negotiate a payment break on another debt for 3 months which has released over £200 a month so that will allow me to use that towards the best debt to reduce and increase monthly savings.

andys15 wrote: »

I think I would be selling the car and the sofa. You must have been in the pickle back in December when you spent over £2.5 k on the sofa. If you could get £1200 for it, that's the barclaycard gone. I don't know what car you have, but looking at the loan, say that's worth £5k. That could be another £5k of the credit cards. Gives you a lot more money to throw at the other cards. Min payment on credit cards is a waste of time, it won't get you anywhere. I got a cheap car a few years back from eBay and ended up selling it for the same price 2 years later. Older cars are not the rust buckets they use to be. Get one with 12 months Mot and it should do well. You need to get money at those credit cards. Going interest only as someone has pointed out, will hardly scratch the surface.

I am where I am and getting the sofas and car was not a good idea if everything we did was good idea then none of us would be in a mess in the 1st place. I accept where I am and that it is all my fault and need to sort it. Selling my car is not an option as I am on finance and returning is not possible either as far as I have been told. I have been selling quite a few things to pay off debts etc so have looked into selling a couch but what I could get I don't know.