Mortgage Now under £10,000 is it worth transferring to a loan to secure the house?

[Deleted User]

After applying many of the MSE tips my mortgage is now sub £10,000 at a variable interest rate of 5.7%.

I currently have an offset type mortgage and wondered is it worth taking out a loan to pay off the mortgage to secure the house. (Incase my husband lost his job or something else financially unexpected happened?)

e.g. if something unexpected happened in the next year we'd be expected to live out of our mortgage overpayments, but if we had a unsecured personal loan, suddenly our financial picture would change, the house would be secure and we wouldn't have the savings to dip into. Be a bit grim but we'd pull through.

Has anyone else done this to ensure that their house is payed off and owned?

silvercar

If you were financially strapped you could temporarily move your mortgage to interest only and pay £47.50 a month.

Only worth taking out a loan if you can get an interest rate of less than your mortgage rate.

I really can't see why you would want to do this.

Ian_W

Are you really expecting something so bad to happen, or are just one of life's naturally cheery people?

As silvercar says you could go IO as a temp measure and I'm sure any lender is going to be very reluctant to repo a property with so little owing. They have to go to court to get possession and I don't think the court would issue an order lightly either in the circs.

You could get a loan and pay 1% or so more but just to cheer you up further, if you default on an unsecured loan the company can take you to court to seize assets to get their money back. And what's your biggest unencumbered asset with your mortgage paid off?