Interest only mortgage good/bad idea

kilbroney

Hi

We have a repayment mortgage, I was thinking that it would be better to remortgae to an interest only as it is a lot cheaper, we are going to be divorcing. He says he will pay it but I am afraid that in the future he might not and if it was interest only it would be a figure that I might be able to manage to pay myself.

Any advice appreciated
Thanks

Boozer

It is a lot cheaper due to you not paying off any capital on the house, if you take interest only do you plan on putting money away for paying it off when the mortgage finishes??

I think you should find out if you could take the mortgage on interest only yourself, then if it would be OK, let him pay for as long as he does, if one day he decides not to pay, you switch it then, but get him to pay off as much capital as possible beforehand and it will leave you less interest to pay.

kilbroney

Wish I could but I do not work at the moment I do intend to look for work, but even then do not think I would get a mortgage as I will still have to claim some benefits as I have two kids still at school, and the amount owing is 85,000 and, I dont think anyone would give me a mortage by myself
Thanks

Cannon_Fodder

Better to sell while finances are in control, than risk falling into arrears which accumulate, get repossessed, which results in a quick, cheap sale, probably causing a shortfall, then being pursued for the lot...

dimbo61

You dont give the value of the property but unless you have a lot of equity in your home alot of lenders will refuse to allow you to change to Interest only.
Your EX will not be allowed to come off the mortgage by the lender!
He needs some where else to live ( rent) with room for the 2 kids to stay.
3 bedroom if you have a boy and girl.
He is liable to pay you 20% of his net take home pay ( CSA website)
So can he afford to pay the mortgage , rent a 3 bed home/flat and pay you 20% of his take home pay and live!!!
Take the kids on holiday, buy school uniform, treats, days out etc.
You wont get a mortgage on your own so if he is happy to pay the mortgage and you can get work you can claim WTC, CTC,CB, Income support, income from work ( 16 hours plus a week) Housing benefit, and maintence from EX

kilbroney

thanks for the replys, the house is worth if sold cheap 200,00 so a good bit of equity ( I think ), yes it is a girl and a boy but there is also a stepchild who he as brought up as his own this past 16 years, who is at uni during the week and home weekends and holidays.

Yes he can afford the above, he says he will support us but I have no trust in him anymore and I am waiting/hoping he will leave the house soon, I am tryng to get things into perspective for when he does leave and I am trying to find out the best course for me and the kids and eventually I would like not to be supportive of him, hope that makes sense

Sunshine12

Alot of lenders now wont let you switch to interest only unless you can prove to them that you have the means to discharge the loan when the term runs out. You can lie about this as they dont check but its not a good idea.

VIGILANT22

Sunshine12 wrote: »

Alot of lenders now wont let you switch to interest only unless you can prove to them that you have the means to discharge the loan when the term runs out. You can lie about this as they dont check but its not a good idea.

So why bothering writing it then?

_Andy_

Sunshine12 wrote: »

Alot of lenders now wont let you switch to interest only unless you can prove to them that you have the means to discharge the loan when the term runs out. You can lie about this as they dont check but its not a good idea.

Fraud never is

C_Mababejive

You have plenty of equity in the house so it might be a good option for a few years until things settle down.

Who knows what the future may bring? A new partner perhaps?

Dont go back.go forward. Keep the house,go interest free.

Bear in mind though that your ex still has an interest in it.

You need to think carefully about that bit and what might/could happen in future.

If it stayed as a repayment,could he pay that also? is he obliged to pay it?