is taking a secured laon really a bad thing???

[blushingm]

we have run up about £30k of debt on credit cards and 2 loans. We are thinking of taking a secured loan to clear everything - we would have about £600 per month extra money. should we do it?

[bigspender30]

get yourself on moneysavingexpert.com and check out the advice there

[wonderstuff]

Only if you can afford the repayments, the draw back is they take your house if you can't pay, and theinsurance if you take it will have lots of eventuallities not covered. we are in massive debt because dh sickness insurance didnt cover loss of income due to back injury

[madamez]

Go to your bank/building society and ask them about a consolidation loan. You will get a reasonable interest rate, at least. If you go with one of these Carole Vorderman/advert in Take A Break finance companies (known as Sub Prime) you will be paying this loan off forever, at very high rates.

[blushingm]

they've offered us 8.8% is thing good or not? We will be able too afford the repayments but it's over 25 years - we can't really afford it over a shorter term as the payments are too much - i never take loan insurance i's just a big con

what are the alternatives

[MegBusset]

At 8.8% over 25 years you will be paying a LOT of interest.

Could you get the debt added to your mortgage, which will presumably be at a significantly lower rate?

[droopytits]

blushingm the same thing happened to me a while ago - i contacted my mortgage lenders and arranged a 5 year loan on top of the mortgage - so its a kind of secured loan, but its in with the mortgage if you know what I mean.
It made sense to me because i was paying a huge amount in interest to pay off my cards.
Just be very careful who you use - try your mortgage lenders first, and if at all possible try not to do it over 25 years - the rate may seem lower but you could end up paying more than you are now if it goes on for 25 years.

[MrsTittleMouse]

It's usually a bad idea for two reasons -
First, you're spreading out the repayments over a long time and so you pay an awful lot more interest.
Second, you still have the credit cards and it takes a LOT of discipline not to put the odd thing on them here and there, and then you end up with a loan and credit card debt and in a worse position that you started.
I would also recommend moneysavingexpert.com as a great place for budgetting and debt repayment advice.

[sarkin]

Take the secured loan and consoliadte on to the mortgage when you come out of your current deal. We have used these guys in the past very helpfull mortgage broker

[noddyholder]

Only if you cut up the cards and don't mind that it will cost a fortune over the long term.It is secured on the house so theoretically if you didnt pay it you could lose your house for 30k.

[blushingm]

thanks all - that's a good idea to contact our mortgage co - i didn't think of that - wwould it matter that we've only been with them since september - we've had a mortgage for 9 years but moved to a new company