Topic: advice please

[stemanche]

hi all,  looking some advice my situation is as follows
 
mint card  2200
sky card (now Barclay card) 2100
Monument card (credit now removed) 2300
Cahoot credit card 2500
Cahoot loan (now Santander) 6000 at 160 a month
MBNA card  5700
Barclay card 2500
egg card 300
argos card 125
Barclay loan 225 per month (paid off oct 2010)
 
couple of overdrafts of 500 each
 
Have missed the odd minimum payment here and there but never 2 in a row, everything is up to date, i have been paying the minimum payments for as long as i can remember and as you now getting nowhere.  I am getting 11k in a few months and want to know the best thing to do with it, also i am hoping to get a mortgage in the next few months with my partner (she is now debt free but had several defaults in the last year) we both earn approx 1200 per month, house is worth 150k and we need a mortgage off 100k to pay off existing mortgage and for her divorce settlement,
 
not sure to contact all my creditors and ask for settlement etc or just to pay what i can with the 11k, any advice will be greatly appreciated, thanks
 

[Steven Jackson]

Hi Stemanche
 
If you are looking to get a mortgage, then the most important thing is to do is make sure your credit rating remains intact. In the current environment it is very difficult and expensive to get a mortgage if your credit rating is bad.
 
Given this, my advice would be to maintain all of the minimum monthly payments until sort the house move out. Try to keep the £11k you are going to get as you may find that you need some or all of it to go towards a mortgage deposit. You will not get a mortgage easily with less then 15% deposit and if you can stretch to 20 or 25% all the better.
 
Once this is all sorted, you can decide how best to deal with your debt. At that time you could even consider a debt management plan or IVA as the effect on your credit rating would no longer be such an issue.
 
 

[AshleyPark]

Good advice from Steven. When seeking a mortgage product i have noticed from personal experience that some mortgage advisors have now started charging a fee for advice that they would have given for free a couple of years before. You should not have to look to hard to find someone who does not charge any up front fees.
 
Lee

[Steven Jackson]

That is a good point Lee. You should not have to pay for mortgage advice Stemanche, there are lots of brokers who will not charge you. However, brokers have always been paid and not unreasonably. Traditionally their fees would have come from the lender but as lenders have tried to cut costs, these commissions have also been cut. As such, some brokers are trying to recoup their fees direct from their clients. My advice is always find out how a broker will charge before you use them and then decide if you think this is reasonable.