Hi momoney and welcome to the site. It sounds as if you are carrying quite a bit of debt (?) and that was enough to put First Direct off giving a mortgage. On top of that, you had to make an arrangement for reduced payments with LTSB at one point. While that was an arrangement that LTSB and you were happy with, it shows that you couldn't meet your debt commitments at that point. So - playing devil's advocate - FD will be thinking "well how do we know whether he/she can meet the new mortgage commitment". The whole credit crunch has made lenders much more risk-averse so the better your credit rating then the better deals you will get.

So what would I do in your position? Well, I'd do a couple of things. Firstly, I would shop around for other mortgage deals. I'd call a couple of independent, "all of market" mortgage brokers to see if they could find me a better deal. I'd be up front with them about your credit history. Secondly, I'd go back to my existing lender to say that you are shopping around and that your bank has been in touch with you about better deals - could they offer you a better rate?".

Thirdly - and this is important in the longer run - I'd look to getting the debts fully paid off. I note that you mention you wanted an extra 6K on your mortgage to pay off your last debts. While I can see why you might want to do this, adding credit card debts onto your mortgage isn't paying off the debt - it is just moving the debt around. In the long run, it makes the debt more expensive because it turns a couple of year debt into a 25 year one. In addition it turns an unsecured debt into a secured one.

You might want to consider putting together a monthly budget using our SOA Calculator and posting it here with details of your current debts etc. We might be able to point out where you could shave off some expense and pay off all the debts more quickly

One final point. When it comes to your existing mortgage - have you checked to see if there are any payments you need to make in order to come out of the deal?

Clariman

momoney wrote on 29. Jan 2009 at 10:28:

Sorry to be pedantic, but consolidating the debt into your mortgage isn't "paying a debt off" - it is "moving the debt somewhere else". You may thing I'm being a bit argumentative or irritatingly pedantic. I'm not really. One of the main issues with consolidation loans is that psychologically the individual feels they have paid off the debt and so never addresses the underlying overspending which is the root cause of getting into debt. Over 90% of people who take out consolidation loans go on to get further into debt! And what do they do then? They consolidate again and keep building up more debt.

Don't get me wrong. I'm not saying that consolidating is wrong in itself - but it is the route to a lot more pain unless you address the underlying problem.

That's why having others take a look at your SOA is a good way to get some feedback on your spending. However, that's your call.

Quote:


In that case, you need to trim back your spending a little further or find a way of earning a bit more money. Why not post your SOA up?

Clariman

If it is consolation, first direct are very tight with who they lend to. They do appear to cream the best or least risk people. They have some fairly stringent regulations for who they give a straight bank account.

It's up to you. If you are happy posting it on the boards, then other people can comment too. Just make sure you don't have any personal info on it like "John Smith's credit card" and "Jane Smith's credit card".

I've never tried copy and pasting an SOA into a PM. I guess it should work

Hi again.

Your income figures appear to be annual rather than monthly. If not, then you are very well paid!! You need to divide it by 12 I think. Is the £2000 on benefits your partner's salary or is it really benefits?

C

Hi Clariman, any feedback on my SOA.

Hi again,

I've just amended my SOA and includes all, as stated this is my part of the expenses since my wife pays for the monthly shopping, childrens expenses i.e. school dinners etc, we have 2, council tax, and heat and light and I pay what I listed on my SOA.

Fortunately I got in some trouble about 2 years ago when I lost my job and found a new job but pays me about £4K less per year.

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 1550
Partners monthly income after tax....... 0
Benefits................................ 165
Other income............................ 0
Total monthly income.................... 1715

Monthly Expense Details
Mortgage................................ 783
Secured loan repayments................. 0
Hire Purchase (HP) repayments........... 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 55
Telephone (land line)................... 30
Mobile phone............................ 35
TV Licence.............................. 15
Satellite/Cable TV...................... 16
Internet Services....................... 10
Groceries etc. ......................... 0
Clothing................................ 15
Petrol/diesel........................... 100
Road tax................................ 20
Car Insurance........................... 50
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 5
Pet insurance/vet bills................. 0
Buildings insurance..................... 15
Contents insurance...................... 5
Life assurance ......................... 20
Other insurance......................... 6
Presents (birthday, christmas etc)...... 0
Haircuts................................ 5
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 25
Total monthly expenses.................. 1250


Assets
Cash.................................... 12000
House value (Gross)..................... 215000
Shares and bonds........................ 5000
Car(s).................................. 8500
Other assets............................ 0
Total Assets............................ 240500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 167000...(783)......0
Total secured & HP debts...... 167000....-.........-  

Unsecured Debts
Description....................Debt......Monthly...APR
GM Card........................4000......95........24.9
Virgin.........................900.......35........0
First Direct...................5000......148.......22.9
Tesco Loan.....................3500......215.......6.1
Sky Card.......................3000......81........22.9
Halifax Card...................3000......80........23.9
Store Card.....................200.......9.........29
Santander......................1500......36........22.9
MBNA...........................1200......35........23.9
Lloyds TSB.....................9500......85........6.9
Total unsecured debts..........31800.....819.......-  


Monthly Budget Summary
Total monthly income.................... 1,715
Expenses (including HP & secured debts). 1,250
Available for debt repayments........... 465
Monthly UNsecured debt repayments....... 819
Amount short for making debt repayments. -354

Personal Balance Sheet Summary
Total assets (things you own)........... 240,500
Total HP & Secured debt................. -167,000
Total Unsecured debt.................... -31,800
Net Assets.............................. 41,700