Help

Holryn

Hi,

I've been trying to reduce my monthly outgoings but am struggling to sort things out - I'm getting very worried.

I have a Virginone account at the moment. The level is £135000 and a rate of 5.7%. I have an endowment which was taken out for £44000 but is going to fall well short of even that.

I have spoken to Virgin about reducing the monthly repayments and the best they can do for me is to move the whole £135000 onto an interest only Flexible mortgage option at 4.64% for the first 12 months.

This will reduce my monthly repayments to £522 from £694. However, I obviously need to cover the shortfall of the endowment to the full final repayment figure of £135000. Trouble is if I do that then I will be back to square one as I will need to find the extra for the premium for either increasing the endowment or doing something else.

I'm having sleepless nights over what to do - I have got absolutely no idea in which direction to go. Any help would be gratefully received. I feel that things are getting desperate.

mummytofour

I think maybe a visit over to debt free want a be would be a good idea, if you list your incomings and our going then you can get some advice from others, as at the mo it would seem you need to be paying off the morgage and you need to find a way to find the extra cash to do so.

Vxx

dander

you've got a mortgage for £135k but only an endowment to cover £44k of it? :eek:

The big question is what kind of terms these things are on. Are you talking about a mortgage that needs to be paid off within the next couple of years, or 20 years in the future?

Holryn

mummytofour wrote:

I think maybe a visit over to debt free want a be would be a good idea

I'm putting together a list now and will post it shortly.

dander wrote:

you've got a mortgage for £135k but only an endowment to cover £44k of it? :eek:

The big question is what kind of terms these things are on. Are you talking about a mortgage that needs to be paid off within the next couple of years, or 20 years in the future?

The endowment was from 1995 when I bought a flat for £44000 - I kept it on when I moved to my present place. The mortgage at the moment is a repayment mortgage using the endowment for part payment. It currently has 18 years and 6 months to run.

dander

Ah well, if you've got a repayment mortgage for part of it, there's much less to worry about. Personally I think you'd be mad to move from repayment to interest only if you've got nothing to cover the lump sum at the end. I'm sure you could remortgage at a lower rate than 5.7%, which would reduce your outgoings a bit.

Of course all this depends exactly how much trouble you are in with other debts, and how much you need to reduce your outgoings. Good Luck.