I stepped on the scales this morning and as with most people got the usual post Xmas shock as the scales tipped into 85kg territory. Now that's not very heavy I hear you grown. But that's not my point . We all have a target weight and if you step out of line it is always a bit disappointing when you stand on the scales and read the number. This now means a battle for the next month to shed the mince pies. For me this means cutting down on excess and getting off to the gym. Not even standing on one leg changes the numbers.
Most of us overindulge when it comes to Xmas and this is not limited to our calorific intact. Overeating and overspending tend to be the most common faults that we have during the festive season. As far as the weight thing is concerned, it comes home to roost when we have to squeeze into that suit you have not worn for two weeks and as far as the spending well that's not for a couple of weeks yet. But it will come! The credit card bill is on it's way.
So how are you going to pay for Xmas?
One way of dealing with this is to consolidate the debt by increasing your mortgage and in essence reducing the monthly amount by paying it over a longer period of time. It is quite a drastic step and you should explore all other avenues before you even contemplate this as a solution.
If you do decide to investigate this then there is one thing that you need to know and understand - LTV (LOAN TO VALUE). Most lenders do not like debt consolidation and will generally only lend to a maximum of between 80% - 85% LTV. This means that your current mortgage plus the additional debt must be less than 80-85% of the value of your property. Here's how they work it out:-
£100,000 property value
£82,000 total debt (£70,000 + £12,000)
LTV= 82% £100,000/£82,000
You therefore need to know the value of your property before you can work out the LTV. You can do this on Zoopla but it's not very accurate.
Virgin and Natwest will look at 90% LTV but if you have too much unsecured debt then you may fall outwith their criteria. It's all about debt to income ratios but I see your eyes are glazing over so won't inflict that torture on you.
Suffice to say that you must do everything that you can to avoid the hefty interest rates that these cards come with. If you would like to have a chat in confidence then give me a call.