Mortgage shortfall while on benefits

wazza

Bought my house in early 90's using an endownment linked mortgage. Have been on benefits for the last four years. The benefit people pay the interest on the mortgage. I pay the monthly endownment premiums. As you know over the last 5 years or so they have been warning us that the endownment payout at the end of the term will not cover the mortgage loan. I have 9 years remaining on my mortgage.

Normally if in full employment i would pay extra into the mortgage loan to reduce the capital year by year. Also put some in long term savings account to offset the shortfall.

But unfortunately i am unemployed. Money's tight and it will be hard to save towards the mortgage. Even if i can save i am limited by how much savings i can have while on benefits.

Was wondering what those who are on benefits do to solve the shortfall on their mortgage.

Also if your mortgage term was up in a few months/next year and you find that your endownment will not cover the loan where do you stand? Would the benefit people help you? Can you extend the mortgage term?

I know i am a bit premature in asking about something that might affect me well into the future but it is something i have been thinking about for a while.

Thanks to those who replied.

lil_me

There are no benefits to help with this. The only thing people usually can do is sell (then downsize/rent) or increase their income via employment etc.

Oldernotwiser

Several building societies will let you carry on paying interest only until you die and the property is sold. You would then be able to carry on having the interest paid after retirement.