Can you re/negotiate your way out of a fixed term deal?

Tradergirl

Hi Everyone

I took my mortgage out in May 2008. I was a first time buyer and took out a 95% mortgage with Barclays. I'm tied into a two year, fixed rate deal which has an interest rate of 6.9%. So I am paying £728.11/month for my £105,000 mortgage. This was a managable amount back in May last year however my income has dropped by 40% and I'm struggling (I haven't defaulted yet though).

I understand that Barclays have to make a profit, they're not a charity after all. However I would like to renogotiate my terms so that I will still pay them back the same amount however over a longer period e.g. say I pay them less money each month but they can tie me in for a longer period.....hope that makes sense.

Do you think they would be open to this idea? I'm trying to be responsible and pro-active however I don't want to give them the heads-up that I'm struggling with the repayments.

P.S the only reason I took this deal in the first place was that Cheltnam & Glouster withdrew their mortgage offer a 3 weeks before I was due to complete. I signed for this the day before completion out of total desperation.

dunstonh

Do you think they would be open to this idea?

They may be willing to accept you extending the term and reducing the repayment but coming off the fixed rate is highly unlikely.

beecher

Over 25 years the payments would be £735 and over 30 years they'd be £691. Is that sort of saving going to make a difference? Could you go interest only in the short term (£603) until you sort yourself out financially? Though you'd be almost definitely in negative equity at the end of the 2 year fix.

You could go to the Debt Free Wannabee site for help in cutting bills/upping income.

cem

dunstonh wrote: »

They may be willing to accept you extending the term and reducing the repayment but coming off the fixed rate is highly unlikely.

What if you are on an interest only mortgage already whereby increasing the term won't really make a difference to the monthly payment?

Wonder if anyone has negtiated this? even if it is to switch to another one of bank's product whereby payment is more affordable

_Andy_

Aside from lenders like Mortgage Express who are waiving ERCs to reduce their mortgage book, no lender will allow you out of a deal without paying the ERCs.