Paying a lump sum off my mortgage - when?

[Shakermaker]

DonkeyApple said:

As credit card debt is stupidly expensive would it not make sense to clear all of that crappy debt first? Seems out of step to have the logic to pay down mortgage debt that is heftier than any suitable cash return and then reverse that logic when it comes to the even more expensive credit card debt.

I'd think it more logical to pay £30k into the mortgage to knock off a chunk of that debt and simultaneously use the remaining £20k that you cannot yet offset against the mortgage debt to remove all consumer debt then use your onward income to replenish that element of the £20k ASAP along with adding the interest you are saving on the new lower mortgage amount ready for 8 months time when you can use the £20k when you remortgage.

That is an option I had not considered, and sounds like a very sensible idea to me. Think I will check with the wife she's happy with me doing that as it is technically "her" money from her mum but for "our" house - her mum doesn't want to be seen to be bailing me out of debt etc.

Shall see what happens but I like this idea, thank you

[DonkeyApple]

Shakermaker said:

DonkeyApple said:

As credit card debt is stupidly expensive would it not make sense to clear all of that crappy debt first? Seems out of step to have the logic to pay down mortgage debt that is heftier than any suitable cash return and then reverse that logic when it comes to the even more expensive credit card debt.

I'd think it more logical to pay £30k into the mortgage to knock off a chunk of that debt and simultaneously use the remaining £20k that you cannot yet offset against the mortgage debt to remove all consumer debt then use your onward income to replenish that element of the £20k ASAP along with adding the interest you are saving on the new lower mortgage amount ready for 8 months time when you can use the £20k when you remortgage.

That is an option I had not considered, and sounds like a very sensible idea to me. Think I will check with the wife she's happy with me doing that as it is technically "her" money from her mum but for "our" house - her mum doesn't want to be seen to be bailing me out of debt etc.

Shall see what happens but I like this idea, thank you

If it's your debt then your wife could lend you the money out of the remaining £20K to pay it off and you pay her the same level of interest that you are currently paying. I.e you consolidate it all into one sum but all your payments are kept in the family and eventually used to pay down the mortgage debt. Better to pay the interest to the missus than the bank. And as you will be technically raping yourself on a ridiculous interest rate that should keep the MiL happy as it shows common sense and no mickey taking at all. As before, you've got to able to pay down the loan asap and be very comfortable that you won't go and rack up more personal debt etc or you are what's technically termed 'a dead man'

[Shakermaker]

DonkeyApple said:

Shakermaker said:

DonkeyApple said:

As credit card debt is stupidly expensive would it not make sense to clear all of that crappy debt first? Seems out of step to have the logic to pay down mortgage debt that is heftier than any suitable cash return and then reverse that logic when it comes to the even more expensive credit card debt.

I'd think it more logical to pay £30k into the mortgage to knock off a chunk of that debt and simultaneously use the remaining £20k that you cannot yet offset against the mortgage debt to remove all consumer debt then use your onward income to replenish that element of the £20k ASAP along with adding the interest you are saving on the new lower mortgage amount ready for 8 months time when you can use the £20k when you remortgage.

That is an option I had not considered, and sounds like a very sensible idea to me. Think I will check with the wife she's happy with me doing that as it is technically "her" money from her mum but for "our" house - her mum doesn't want to be seen to be bailing me out of debt etc.

Shall see what happens but I like this idea, thank you

If it's your debt then your wife could lend you the money out of the remaining £20K to pay it off and you pay her the same level of interest that you are currently paying. I.e you consolidate it all into one sum but all your payments are kept in the family and eventually used to pay down the mortgage debt. Better to pay the interest to the missus than the bank. And as you will be technically raping yourself on a ridiculous interest rate that should keep the MiL happy as it shows common sense and no mickey taking at all. As before, you've got to able to pay down the loan asap and be very comfortable that you won't go and rack up more personal debt etc or you are what's technically termed 'a dead man'

Most definitely.

Thanks for the good advice; I will see what I can do to make this the best outcome!

[johnwilliams77]

Shakermaker said:

Most definitely.

Thanks for the good advice; I will see what I can do to make this the best outcome!

I assumed that your credit cards were 0% interest or something as I thought that everyone here would know the first thing you do with any cash is clear debt as credit card debt is absolutely ruinous.

[pkrplyr]

I would suggest over paying by the maximum you can, and then when the fixed term ends, find a new deal and reduce the loan with the remainder.

[Shakermaker]

Update

Thanks for your advice everyone. Very helpful, and put my wife and I on the best track.

Paid the maximum amount off the mortgage with no penalty.

Paid credit card off fully from the remaining funds. New set up is I am paying the same amount into our shared account each month with the view to paying back the amount I used to pay off CC to avoid any more at horrible interest rate.

On track for decent remortgage come December and have just spotted the another thread about revaluing which is of great use.

And I thought this forum was just full of cars...