Moving mortgage, changing payments with debt

Moving mortgage, changing payments with debt

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wiggy001

Original Poster:

6,545 posts

272 months

Monday 20th October 2014
quotequote all
This should be a straightforward question but I want to make sure I'm not missing any options or things I should be considering.

Current situation is that I owe £198k on my mortgage, property is worth around £270k and I owe £15k on a credit card (0% until April 2015) that I am clearing at a rate of £800 per month.

My mortgage is a variable rate at 4.74% with 20 years left to run and my desire is to reduce the term as soon as possible, however it seems prudent to clear the credit card first.

Assuming I am accepted, Yorkshire Building Society are offering 1.84% fixed for 2 years and I have 2 options:
1. bring the term down to 14 years, paying roughly per month the same as I am now and continue to clear the credit card at the same rate
2. leave the term at 20 years reducing my payments by £300 and add this to the £800 a month to clear the card.

Option 2 seems the most sensible thing to do, as I can then start overpaying the mortgage once the CC is clear.

Is there anything I should be considering with this or is it as obvious as it seems?

Thanks in advance