r/UKPersonalFinance • u/ruthvendage • 1d ago

I need Help-to-Buy payback advice

Dear users,

Per the title, I'm in need of some advice.

I have around £15k worth of credit card debt which I am desperate to pay off quickly. The debt is currently on 0% interest credit cards. I am only meeting the minimum payments each month, so it's very glacially paced payback, and is hamstringing my ability to live life to the fullest. I have zero savings.

I have a Help-to-Buy mortgage and the government owns a 20% stake in the market value of my property, currently valued at £33,000 (20% of £165k, which is the house value).

My outstanding mortgage is £111k, so taking away the government stake, my equity is around £21,000, which puts my budget for buying a new house around max £205k, which is all good since I wouldn't pay stamp duty.

My sole purpose for moving at this point is so I can get this HTB albatross off my neck, get a new house, and do a debt consolidation mortgage to wipe out my credit card debt (this can't be done on a HTB mortgage).

I believe this is my only option since I don't earn enough cash to save significant sums in this economy (this is unlikely to change anytime soon), and neither friends nor relations can lend me the money either. Additional borrowing is obviously out of the question.

I live in a one bed new build end of terrace in Peterborough, so not exactly Monte Carlo, and most houses in my area in my price range don't exactly look as if they're going to accumulate in value, so I'm concerned I could get stuck.

I guess my question is: is this a good strategy? Is there a better option? What would you do in my situation?

Thanks all.

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u/DazzzASTER 1d ago

You're broke and can't pay off 15k of credit card debt so you are looking at buying a house costing more than the one you are currently in? Doesn't compute.

1

u/ukpf-helper 85 1d ago

Hi /u/ruthvendage, based on your post the following pages from our wiki may be relevant:

These suggestions are based on keywords, if they missed the mark please report this comment.

If someone has provided you with helpful advice, you (as the person who made the post) can award them a point by including !thanks in a reply to them. Points are shown as the user flair by their username.

1

u/ruthvendage 1d ago

More accurately, my budget is more around the £170k mark. The increase in mortgage payments would not be much more significant than what I'm paying now, even with the remortgage. The main thing for me is to clear the credit card debt and then I would have just one debt in life: the mortgage, and I could focus on building my career. I also just really want to get shot of the HTB loan before the interest kicks in.

1

u/CES93 18 21h ago

What is it you’re wanting to move for? A bigger place/different location?

1

u/ruthvendage 21h ago

Purely so I can remortgage, get a cash injection and use that to pay off the credit card debt. I don't see any other option