Consolidating unsecured credit into your mortgage is not something that should be considered a light decision. Before making this decision it is important to speak to a mortgage advisor in York to consider all the options.
By rolling unsecured credit into your mortgage, you will normally pay back more overall. However, your monthly payments may be lower and for some people that is the main motivation behind it.
Remember, you are securing debt against your home. If mortgage payments are not kept up with then you will be at risk of your home being repossessed which is very different to missing payments on loans or credit cards.
In the past, it has often been quite easy to obtain credit, perhaps too easy. It’s quicker for people to borrow money rather than saving up. Sometimes people have used the loophole of investing in remortgage for home improvements to increase the value of their property by a sizeable amount. It is hard to try and pay off the debt itself when over time it is accumulating interest. Not everyone qualifies for zero percent credit card transfers.
Before consolidating credit, it is best practice to do a budget planner beforehand which will allow you to analyse your outgoing expense. These may be luxury items that you are able to go without for a while, i.e. gym membership, takes, etc. Perhaps a personal loan to consolidate your credit cards could be an answer as a loan has a set end date whereas a credit cards. Additionally, since a personal loan is normally taken out over a shorter term than a mortgage then you may pay back less interest.
It may also be worth speaking with a family member who may be able to help. It may seem embarrassing for some people to ask for a bail out but often family members understand and if they are able to help then they will.
If all the available avenues have been exhausted, then a debt consolidation mortgage might be right for you. It certainly is one way of reducing your monthly payments if you are struggling to save but it could be difficult to carry out without an experienced remortgage broker in York.
Date Last Edited: December 19, 2023