eeek fixed rate ending, kensington want 9%. help!

thepinkladez_2

hi i am not very good with mortgages but i could do with some help!

Kensington have just informed us that our fix rate will now end at he end of Feb 09 instead of the end of june 09 like they have been saing for last 2 years!Apparently mortagage wasnt running inline or something!Problem is they have no fix rate offers and our mortgage will jump from £700 to over £900 per month!:eek:

Our mortgage is currently £111,000 and house price seems to be around £135,000 to £150,000 (thats what current similar houses are selling for in area!)

We do not have a great credit score as we are on a dmp, and dh has a co on the house for £12k.However we have never defaulted on mortgage.

Dh is also self employed but currently has no books in place yet til april so i assume would have to self cert?He has been offered a job but will only be getting about £1200/1400 PCM rather that the £1700-£2000pcm he gets now.

I earn £11,700 ish per year.My credit score is also getting better as most have been cleared by dmp.

What if any mortgages would we be able to have? would we be able to get something if dh goes employed rather than self employed?Or are we looking at selling? any help much appreciated!

koexelek

First thing I would do is contact Kensington to see if they will offer you a new deal to stay with them ( assuming you have not already done that)

Any suitable deals elsewhere are likely to cost you a fortune in interest rates and set up fees

_Andy_

Also the charging order may cause you problems as it's doubtful whoever has the charge would agree a deed of postponement.

thepinkladez_2

kensington said they didnt have anything else to offer at the moment, they said it might have dropped by feb or they might have a better deal by then but there is no way of telling, it could also be even worse by then i guess!!

koexelek

I think even the Kensington SVR will be better than anything you will get elsewhere.

At least you are not tied in anymore, so if a better deal does eventually become available, you can jump ship easily

Toughluck

As it has been mentioned above I don't think you can change lenders if it is Feb next year or even June. Personally I would probably stop you in track and tell you to stay put and pay your current lender or worst case sell up.

there is just a mixture of things here, self cert, adverse, charging orders, high loan to value. As koexelek said the 9% with Kensington will be a blessing in disguise. You think that rate is high, wait until someone bodges your valuation to give you a quote. then you will fall off your chair and realise that Kensingotns rate isn't that bad after all.

shellismith

hi

I understand were you are coming from we are with Kensington - took the mortgage out 4 years ago first 1 year was a fixed rate when it came to an end i contact them and asked about new deals available and was told they cannot give advise and only offer mortgage deals to new customers not existing. (we even had a financial advisor try) - are interest rate is now 11.20% EEEK! This is because Kensington go by the LIBOR rate and not the normal bank of england rate (they don't tell you this our advisor found this out). so basically your mortgage payments will just go up and up

My best advise would be speak to an independent advisor and seriously swap mortgage companies don't get into the trap we are in currently going through repossession!!!! Kensington are not sympathetic at all.

Shelli

opinions4u

If you want to keep the house, I think you need to start budgeting now to pay the higher mortgage payments.

If you could save £200 a month x 9 somewhere (an ISA perhaps) you would have an £1,800 cushion to fall back on in a future crisis (or to reduce other borrowings with?).

Then when the higher payments hit, you stop saving but have proved to yourself that you can afford the payments.

Alternatively, put the house on the market and start renting when you've sold. It may be a few years before you get a mortgage again though.