First Remortgage

road2ruin

Hi all,

I was hoping I could get some advice. I was a first time buyer and purchased my property in February 2007. I am coming to end of the 2 year fixed rate period at which point my mortgage repayments take a fairly hefty jump. The original plan was to try and get the LTV under the 90% mark which would, in theory, give me a wider choice of mortgages to go for.

However, my problem is that the flat I bought for £210,000 is now work a similar amount 2 years on. My LTV is probably still floating around the 95% mark so I’m not better off in terms of equity in the flat…..I should add that I am on interest only.

The issue I have is that I really don’t think that I will be able to afford the revised monthly repayments come Feb 2009 and I am almost certain that no other lender will be overly enthusiastic about touching me as I guess I would be in the ‘high risk’ bracket.

Can anyone give me any pointers on how to proceed? Any help would be greatly appreciated.

Cheers,

Dan

_Andy_

Your only real choice will be to see what your current lender can offer you, e.g. a new fixed or tracker product.
You're not going to have joy looking for a 95% LTV IO product elsewhere.

herbiesjp

Do you have any extra funds to reduce your LTV to 90%?

Who is your current lender? They would always be your first port of call in any re-mortgage scenario - but even more so based on the figures

road2ruin

Cheers.....unfortunately those replies are as I suspected they would be....

I do not have the funds to get under the 90% LTV so that would not be an option.

My lender is Alliance & Leicester.

herbiesjp

Your only option then is to go back to A&L and see what rates they can offer you that will hopefully be easier for you to afford

bec_73

I'm in exactly the same position as you and have just returned from a meeting with my financial advisor. It doesn't make happy reading.

Basically his advice today was to borrow money from a family member to ensure I had 90% as I will be hard pushed to remortgage with just 95%. T his means I clear out my savings and have to borrow 3,500 on top just to be able to remortgage.

He recommended sticking with an interest only mortgage and putting the money which would be paid towards the capital into a Cash and Equity ISA. However, I am wary of this and feel it would be safer to change to a repayment mortgage.

I'm afraid that it's people like you and me who are being shafted by the credit crunch.

ad9898_3

I'm sorry to hear the problems people are having, to be honest the SVR of your current lender is about all you can hope for.

_Andy_

bec_73 wrote: »

I'm in exactly the same position as you and have just returned from a meeting with my financial advisor. It doesn't make happy reading.

Basically his advice today was to borrow money from a family member to ensure I had 90% as I will be hard pushed to remortgage with just 95%. T his means I clear out my savings and have to borrow 3,500 on top just to be able to remortgage.

He recommended sticking with an interest only mortgage and putting the money which would be paid towards the capital into a Cash and Equity ISA. However, I am wary of this and feel it would be safer to change to a repayment mortgage.

I'm afraid that it's people like you and me who are being shafted by the credit crunch.

Doesn't sound like a great adviser.

bec_73

I'm in exactly the same position as you and have just returned from a meeting with my financial advisor. It doesn't make happy reading.

Basically his advice today was to borrow money from a family member to ensure I had 90% as I will be hard pushed to remortgage with just 95%. T his means I clear out my savings and have to borrow 3,500 on top just to be able to remortgage.

He recommended sticking with an interest only mortgage and putting the money which would be paid towards the capital into a Cash and Equity ISA. However, I am wary of this and feel it would be safer to change to a repayment mortgage.

I'm afraid that it's people like you and me who are being shafted by the credit crunch.

herbiesjp

Who is your current lender bec_73?

What lender has he suggested?

road2ruin

As things go it all turned out reasonably well......I went back to Alliance & Leicester and managed to get a remortgage without any checks / valuations or anything....

Ended up on a 2 yr tracker fixed at 1.39 over BoE base rate which means, as things stand my mortgage is going to cost me an extra £150 pm instead of the £450 odd that it was originally going to.....

Now the challenge is to try and keep my job as redundancy is looking a real issue at the moment...