Consolidate my unsecured debt

Posted on 14 June 2017 by Jane

I have a property with approx value £320,000.00 and current mortgage outstanding is approx £185,000.00. I would like to remortgage for approx £220-225K to consolidate credit card debt/loans. I have never missed any payments but I am worried that the Bank will not even look at the application because of the debt outstanding, even though I am using the remortgage to pay it off. Any advice please.

Hi Jane,

I have the feeling that you have been speaking to a bank/banks and the answer was 'No'

The good news is there are some lenders that will consider helping you borrow £35,000 to £40,000 for debt consolidation. The loan to value is around 70% when we add the existing loan, which should give you access to some competitive rates.

You have not indicated your income details and the reason why the debt has occurred, which is important as debt consolidation is a hot topic with many of the high street lenders. Some lenders will also assess affordability based on the current level of debt, as they are concerned that having used the mortgage to repay the unsecured credit, you might run it up again.

I would suggest it's worthwhile speaking with one of our advisers who will be able to guide you further. If you'd like me to get one of them to contact you, please let me know.

Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.


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