What is a debt consolidation mortgage?

A debt consolidation mortgage lets you combine unsecured debts such as credit cards, loans and store cards into your mortgage, replacing multiple payments with one monthly repayment.

Does debt consolidation affect my credit score?

Consolidating debt itself does not automatically harm your credit score, but applying for a new mortgage or remortgage will create a hard search on your file. Many people find their score improves over time if consolidation helps them keep payments under control and avoid missed or late payments.

Can I consolidate debt with bad credit?

Yes. Some specialist lenders will consider applicants with defaults, CCJs, arrears or high credit card balances. A debt consolidation mortgage calculator can help you see whether rolling unsecured borrowing into a mortgage could make your monthly outgoings more manageable before you speak to an adviser.

Will a consolidation mortgage reduce my payments?

A consolidation mortgage can reduce your monthly payments because the debt is repaid over a longer term at a mortgage rate, which is often lower than the rate on credit cards or personal loans. However, stretching the borrowing over a longer period may increase the total amount of interest you pay overall.

Is consolidating debt into a mortgage a good idea?

It can be helpful for some people, particularly where high monthly unsecured payments are causing financial pressure. However, you will be turning unsecured debt into debt secured against your home, and you may pay more interest over the full term. Professional mortgage advice is important before deciding whether consolidation is suitable for your circumstances.

Debt Consolidation Mortgage Calculator

Compare your current monthly outgoings with a new mortgage that consolidates some or all of your unsecured debts.

Current mortgage

Current mortgage balance (£)

Current monthly mortgage payment (£)

Unsecured debts to consider

Add credit cards, loans, store cards and other commitments. Tick "Include" if you plan to roll that balance into the new mortgage.

Description	Balance (£)	Monthly payment (£)	Consolidate?

New mortgage after consolidation

New mortgage interest rate (%)

New mortgage term (years)

Before consolidation - total monthly outgoings

After consolidation - total monthly outgoings

New mortgage payment

Debt consolidated into mortgage

Monthly change (saving or increase)

This calculator gives an illustration of how consolidating unsecured debts into your mortgage could change your monthly outgoings. Spreading debt over a longer mortgage term can mean you pay more interest overall, even if your monthly payments fall. Securing previously unsecured borrowing against your home also increases the risk if payments are not maintained.

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