Debt / PCP car / remortgage - help!

Nugget15 · 2025-04-20T18:46:59+00:00

Remortgaging on 1st October. At the mo we have 8k in CC debt (anticipate this will be down to around 5k by September). PCP car which ends in March 27. Also expecting 2nd baby in July so will be back on mat leave. Have around 3k in savings. We are a two adult household earning 120k joint income with one dependent (one on the way). We need to remortgage and our circumstances upon remortgaging this time round are wildly different from when we took our mortgage out in Oct 2023 (first time buyers, 80k deposit, minimal debt). Staying with current lender will be easier and mean all the above wont be looked at in great detail, but I know we can get a better deal if we switch. Would the above put off a new lender or should I try and switch?

Dahliasings91 · 20/04/2025 20:56

Have you considered a mortgage advisor?

Youcancallmeirrelevant · 20/04/2025 20:58

The amount banks will lend you will reduce with another child, have you done some calculators to check they'll still lend you enough? 100% either get a mortgage broker (most are free) or just remortgage automatically with current lender on one of their offers so no new credit checks

CalypsoCuthbertson · 20/04/2025 20:59

Why don’t you do quick quotes on Money Supermarket to see what’s out there?

CalypsoCuthbertson · 20/04/2025 21:15

Sorry ignore me - missed the point!

Original poster

Nugget15 · 20/04/2025 21:33

Thanks all
I’ve done some initial checks on comparison sites and I can get rates of around 4.35% so 1800 pm but my current lender is offering me 5.25% 2050pm which is insane and over £200 a month difference for 2 years. I know I’ll need to factor in legal fees and the credit checks etc

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Temporaryname158 · 20/04/2025 21:33

It’s not the question you’ve asked but £3k savings and debt on this salary is not ideal.

i would immediately cut all in necessary spending to pay off the debt and review the car situation. If you pay off your debts you can save towards a car outright.

you seem in quite a precarious situation if anyone lost their job, or indeed you go on mat leave

Original poster

Nugget15 · 20/04/2025 21:47

Temporaryname158 · 20/04/2025 21:33

It’s not the question you’ve asked but £3k savings and debt on this salary is not ideal.

i would immediately cut all in necessary spending to pay off the debt and review the car situation. If you pay off your debts you can save towards a car outright.

you seem in quite a precarious situation if anyone lost their job, or indeed you go on mat leave

We are tied into the car until March 2027 and we remortgage this year so not much we can do unfortunately.

re savings we actually have 12k but we need to spend 9k next month doing some essential work in our house so that will leave us with 3k
realistically we can’t pay off 8k in a few months - but can definitely get it down to 5k.

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Brienneoftarthismyhero · 20/04/2025 21:51

If you remortgage to another lender there shouldn’t be legal fees unless you have something unusual registered at land registry, like shared equity/ownership or changing names on the title register. You will need to pass credit check though

Original poster

Nugget15 · 20/04/2025 21:54

This is good to know thank you.
Thankfully both mine and my husband have excellent credit (our debt was higher and we’ve consistently brought it down) but I don’t know if the other factors will rule that out.

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Bjorkdidit · 21/04/2025 07:40

You need to consider other factors such as the LTV should have improved as you'll have paid off some of the mortgage and the property could be worth more. This might get you into a lower percentage bracket.

Also be honest about your expenditure and whether you're able to pay off more of the £8k debt, which you could reduce to £5k by using the rest of your savings, plus you say you can pay off another £3k. I know that will leave you with no savings but if you have an emergency you can always use the credit card again.

Then you 'only' need to pay off another £2k so I'd be willing to bet you could make those savings from your current incomings and outgoings by having a frugal few months.

Have a look at the Moneysavingexpert money makeover and cut all expenditure where possible. I assume the debt is on a 0% deal, if not that's something else you need to address.

Then talk to a broker about your position and mortgages you'll qualify for. As long as affordability stacks up, the car debt and reduced income shouldn't be a problem.

If the credit card debt stops it, one option could be to let your mortgage roll over onto the SVR and apply for another deal a bit later. This may be cheaper than locking into your current lender's fix for 2 years.

Nearlyadoctor · 21/04/2025 08:15

How urgent are the works to your house? Could you clear the CC debt now and then get a loan for renovations after you’ve remortgaged?

Original poster

Nugget15 · 21/04/2025 15:48

Bjorkdidit · 21/04/2025 07:40

You need to consider other factors such as the LTV should have improved as you'll have paid off some of the mortgage and the property could be worth more. This might get you into a lower percentage bracket.

Also be honest about your expenditure and whether you're able to pay off more of the £8k debt, which you could reduce to £5k by using the rest of your savings, plus you say you can pay off another £3k. I know that will leave you with no savings but if you have an emergency you can always use the credit card again.

Then you 'only' need to pay off another £2k so I'd be willing to bet you could make those savings from your current incomings and outgoings by having a frugal few months.

Have a look at the Moneysavingexpert money makeover and cut all expenditure where possible. I assume the debt is on a 0% deal, if not that's something else you need to address.

Then talk to a broker about your position and mortgages you'll qualify for. As long as affordability stacks up, the car debt and reduced income shouldn't be a problem.

If the credit card debt stops it, one option could be to let your mortgage roll over onto the SVR and apply for another deal a bit later. This may be cheaper than locking into your current lender's fix for 2 years.

Edited

Thanks so much will look into this money makeover

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Original poster

Nugget15 · 21/04/2025 15:49

Nearlyadoctor · 21/04/2025 08:15

How urgent are the works to your house? Could you clear the CC debt now and then get a loan for renovations after you’ve remortgaged?

Pretty urgent we’ve had a persistent leak and it’s got to the point now where it’s affecting the kitchen units (they’re coming away)

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ihmysrn · 21/04/2025 15:52

How’s your affordability? I really wouldn’t worry about the PCP, lots of people have mortgages and PCP, so long as your affordability is well within range it won’t matter, and the same will be for the credit card as well. You need to speak to a broker.

Original poster

Nugget15 · 21/04/2025 19:18

ihmysrn · 21/04/2025 15:52

How’s your affordability? I really wouldn’t worry about the PCP, lots of people have mortgages and PCP, so long as your affordability is well within range it won’t matter, and the same will be for the credit card as well. You need to speak to a broker.

I think we are doing ok affordability wise. The mortgage we took out in 2023 was not the max we could have taken and we have money left over monthly (we’ve been able to save and consistently pay off debts). We had such bad luck with our old crumbling house we have had to do quite big repairs that didn’t get picked up on the survey and meant we had to buy everything for our home with CC which is why our debt was so high but we have got it down considerably.

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