C+G Interest only Mortgage

GOLFER

Hi Folks

Just looking for a bit of advice.I was wondering if it is possible to swap from a repayment mortgage to an interest only mortgage for a couple of years.

We currently have £120000 over 20 years left. House worth around £185000.

If i swap to a Int only mortgage i could save about £250-£300 per month. We both have life ins for about £110000. Would i need to cover myself for anything else ?

We are struggling at present with int rates, fuel costs etc and have 3 young kids so not too easy lol

If we could do this swap then can we move back to a repayment mortgage in 2 years time and take it over 18 years, hopefully by then with pay rises, kids at school etc it will be easier to manage.

So what i need to know is this opossible to do and if i decide to stay with C+G will they just swap me over from variable rate to a new fixed rate interest only mortgage, or will i need to go through all the hassle of re-applying ans lawers fees, valuation fees etc.

Your opinions are most welcome

Thanks in advance

Golfer

koexelek

C & G should do that for you without too much of a problem.

You don't have to remortgage or anything like that, but they might charge you an admin fee to do it ( £75 ish at a guess, if they charge )

GOLFER

So is this something you would recommend or should we look at some other method.

I have looked at a few and the best i could save would be about £75 month.

If i decide to do this is it going to affect my credit rating or shiow up on my credit file.

thanks

dimbo61

The problem with interest only is that in 2 years time you will still owe
£120,000 and be 2 years older !
You have managed to pay the mortgage up to now and C & G may want to know how you are going to repay the mortgage or limit you to 2 years interest only deal ( they now have stricter rules about repaying mortgages )
Could you save the difference into an ISA in your OH name !
Can you lengthen the term but keep it repayment
Please try and repay your mortgage before your kids go to UNI !

dimbo61

In 2 years time interest rates may be 8/9/10% or they may be 4% who knows !

GOLFER

YES I UNDERSTAND

But what we propose to do is once the two years are up take out a repayment mortgage over new term of 18 years.

Its just a stop gap to give us some leaway. But I really do want peoples opinions and willing to look at anything to lower our mortgage payments.

So let me know what you honestly think the pros and cons are.

thanks

Golfer

_Andy_

Pros - lower monthly payments
Cons - not paying back any of the debt in that time, more interest paid in the long term.

GOLFER

Finally could someone confirm the following for me

1. Would this be able to be done with the C+G ie transfer from repayment to interest only.

2. If we did this for 2 years then remortgaged after two years to a repayment mortgage over 18 years woudl there be a lot more interest to pay over the new term.

Many thanks

Golfer