If you have a
mortgage:
- A remortgage may result in a lower monthly payment that
will help reduce your total monthly outgoings, but do
ensure that you understand any arrangement fees that may be
charged to the amount remortgaged. And don't start spending
once you experience the improvement to your monthly
cashflow.
The lower monthly outgoings should help you get back on
your feet financially, not provide you with an additional
pot of money to spend as before, unless that is, you
channel surplus funds into further debt reduction - on your
credit cards, for instance. Remember, your debt has
not decreased, just become a bit cheaper to service.
If you have unsecured
loans:
- These unsecured loans have fixed payments over the term
of the loan, as the interest rate is set at the outset.
They form a useful means of debt reduction as you have to
pay a set amount each month, so your borrowing is steadily
reducing.
If your credit worthiness was poor when you took them
out, however, you may not have a good rate. Check out the
total amount repayable on these loans, rather than just the
APR. The monthly payment multiplied by the total number of
months will indicate how much more than the amount borrowed
you are paying back.
If you have credit and
store cards
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