Financial Advice?

I have 鎷?6k debt on 2 credit cards (4.9%) and a loan (5.8%). If I continue working as I am, I should be able to clear my debt by July 2008.

My boyfriend has 鎷?5k credit card debt. The rates on his cards are high and he struggles to pay anything over the minimum amount each month.

He has been advised that he could remortgage for 97% of the property at 5.69%, giving him 鎷?5k to use to consolidate all of his debt and 鎷?0k of mine. The repayments would be easily manageable between us. I%26#039;d be able to pay of my remaining debt in 6 months after that we%26#039;d also be able to save a substantial chunk of money each month (to get married %26amp; travel).

Would it be advisable for him to include his %26amp; my debt into his mortgage or should we just put his debt onto the flat whilst I stick to the plan of paying mine off?

In addition, the flat is badly in need of a new bathroom and kitchen, should we use some of the equity for this instead as then it%26#039;ll be going back into the property?

Financial Advice?

I have to agree with World is Big Enough, somewhat, on this one.

If you refinance that 35k into the mortgage or take out a 35k equity loan, you are going to end up paying much much more in interest, then if you had just paid them off separately. On a 8 year equity loan of 35k, you would have paid over 8.5k in interest alone.

My suggestion to you is to set up something called a debt snowball. Here is how it works.

1. List all of your debts in order from lowest balance to highest balance with their current amounts and minimum payments.

2. Pay nothing but the minimum on all the debts except the lowest one

3. Take on a second job (temporarily) or sell some stuff to quickly pay off the lowest one.

4. Once the lowest is paid off, roll the previous payment into the next lowest and keep doing so until all are paid off.

Example

CC 1: 2000, 75/mo

CC 2: 5000, 100/mo

Loan: 9000, 300/mo

Once CC 1 is paid off

CC 1: 0, 0/mo

CC 2: 4600, 175/mo (75 from CC1 + 100 from original payment)

Loan: 8600, 300/mo

Once CC 2 is paid off

CC 1: 0, 0/mo

CC 2: 0, 0/mo

Loan: 7800, 475/mo (175 from CC2 + 300 from original payment)

As the snowball goes down hill, it picks up more snow allowing for the debts to be paid off faster and faster.

And above all things, do not join accounts or debt with anyone you aren%26#039;t married too.

Financial Advice?

Assuming that the U.K. has the same tax laws that we do, the credit card debt is not tax deductible. Get rid of it as soon as you can. However, you assuming HIS debt when you are not married is perhaps the worst thing you can do. If you do want to live with him and love him, get married, then all of your property, debts and assets, is communal. If you use your money to renovate his flat and you break up, he keeps the flat and you keep the debt.

In either case, pay off the debt, THEN think of renovating. Spending money is still spending money.

Financial Advice?

Never bundle you%26#039;re financial situation with anyone who you are not legally bounded to do it with! I don;t know how your relationship is going, but if you for some reason break up, you%26#039;re now tied to his financial situation and behavior for a looooonnnnggg time after wards. Also, the joining up could adversely impact your financial ratings (credit scores or the equivalent in Britain).

Financial Advice?

Get as much debt moved onto the mortgage as possible. Credit cards are a complete rip off and making the minimum payments will leave you paying them all your life. However, yours seem reasonably low so i would stick with the credit cards, theres no need to be paying higher interest rates but get the lowest you can and possibly get some other financial help to slow excess spending as you are likely to continue building up more debt.