How to deal with this mortgage situation?

johnymurchi

Hi all,long term viewer first time poster, any help will be great on this matter as i am rather green on the whole thing of mortgages, anyway here i go... my mother and father split several years ago,with her moving out and him staying in the marital home,her moving to another house,last year it came to light that he had stop paying the mortgage and it was aroun 7 months in arrears, at this point my mother foolishly began to pay the mortagage aswell as her own, however to pay the arrears she cashed in a policy related to the mortgage,when she did this she was told she had broken the mortgage argeement and the intrest on the mortgage (a 20 year intrest and repayment mortgage???whatever that is)would revert to the standard APR which is around the 9% mark, also the house as been on the market for around 6 months,she has since told the bank thats she cant afford to pay the full amount but could pay some of it,needless to say the bank has been less than helpfull. so basically i am just looking for some advice,she could pay the mortgage at its previous rate and as the house is on the market she just need a bit of leeway untill the house sells then the mortgage will be payed in full. as it stands the house is not in arrears. many thanks

silvercar

You will need to fill in the gaps to give a better understanding.

Firstly, is the former marital home now in your father's name or is it in joint names?

Years ago it was common for endowment policies to be attached to the mortgage. As a condition of the mortgage, if the endowment policy was encashed, the mortgage reverted to a traditional repayment mortgage. It could well be that the terms of the mortgage specified that this would be at the standad variable rate. I'm guessing that this mortgage has been running for a long time and your parent(s) have never moved it around to take advantage of new deals. This would explain why old mortgage conditions would be enforce.

Where you go from here depends on where things currently are.

How high is the mortgage? Current value of the property? Whose name is the property in?

There is the possibility of remortgaging to a new lender.