Will my mortgage company allow interest only payments?

rose28454

I split from my oh 2 years ago and have struggled to pay the mortgage. I now have about £3500 worth of arrears and the building society agreed to my paying it back at £35.00 per month. ( I also have a lot of cc debt I am trying to clear)
My husband and I have decided that we will not get back together and the time has come to sell up. However there are 2 charging orders from 2 of the credit card companies. 1 is with Egg and 1 with HFC.
At the moment I am preparing court papers to get the HFC one reversed which may take a couple of months. However I am struggling to pay the mortgage. Am I right in thinking the Building Society would accept interest only payments until I sell.

xmaslolly76

Some of the pure money threads may be a better place to post this. I'm pretty sure that alot of companies would agree to that if it helps you pay whilst you sell so you dont run up more arrears but it is down to the individual company give them a ring and see what they say. If they get funny with you the thing to do is go down to the local cab and see what they can do to help :-)

ellay864

You'd need to speak to your mortgage lender but as someone who took out endowment mortgage (interest only) back in the 80s when they were seen as THE way to go I've lost out badly. The idea was that on maturity they pay off the mortgage and give you bit more besides. But due to the financial world these days mine won't pay out anywhere near what it was meant to, and I've now had to go to part repayment to be sure my mortgage gets paid off. The only way the mortgage people would have been sure of it being paid off would have been to kill me!! I'm not saying they don't do them now - I'm no expert at all - but I can't see them being such an attractive option and they may be quite costly because of that issue
The main thing is to talk to them (and anybody else you owe money to) and explain your situation. Lenders would rather work with you to help you through a tough time that to end up in a really dodgy situation where they can't get any money from you

silvercar

Under what terms have they accepted a reduced payment towards the arrears? If it is a suspended repossession order through the courts, they are unlikely to accept any change to the agreed repayments.

How much equity is there in the property? If there isn't any and the total costs of selling and repaying the mortgage and the charges exceed the sale price, you may have little option that to be voluntary repossessed.

Your ex may need reminding that he is jointly liable for the mortgage and the lender will chase him as well as you.

Do post on the housing board for more people's help.

Bufger

You're better off asking on the Mortgages part of this site as there are plenty of mortgage advisors and even some underwriters etc that frequent that board, they will be able to accurately answer your question for you.

HTH

rose28454

silvercar wrote: »

Under what terms have they accepted a reduced payment towards the arrears? If it is a suspended repossession order through the courts, they are unlikely to accept any change to the agreed repayments.

How much equity is there in the property? If there isn't any and the total costs of selling and repaying the mortgage and the charges exceed the sale price, you may have little option that to be voluntary repossessed.

Your ex may need reminding that he is jointly liable for the mortgage and the lender will chase him as well as you.

Do post on the housing board for more people's help.

They accepted the reduced payment for the arrears on a six month review basis. There is about £100,000 equity. No point chasing my ex as he is on Long term invalidity and does not think he is liable for anything as I asked him to leave ( due to his alcoholism). When the house is sold he already knows that the split will not be 50/50 due to the fact I have been paying £750 a month mortgage for the past 2 years. How do I move this to a more appropriate board?

silvercar

How do I move this to a more appropriate board?

You can't. Either PM a board guide or just start a new thread on the housing board.

You may not chase your ex, but the lender will.

Ask to go interest only and see what they say. By the sound of it, there is little they can do if you make reduced payments while the property is on the market.
You could see what your lenders policy is on an assisted sale, this is where they offer help to you in selling your home as opposed to you handing the keys back.

JoJoB

Someone with more expertise will be along soon but I would say focus on your mortgage repayments/arrears as opposed to clearing your cc debts. If any payments need to be renegotiated lower then it is those.

The priority debts to keep on top of are mortgage and council tax as the consequences of arrears with either of those are the most serious/result in the most upheaval.

Post your financial statement up on the debt board (all your incomings and outgoings) and see if there are any obvious places to save. Whatever surplus (no matter how little) there is after paying your PRIORITY bills should be offered to the cc companies as part of a debt management plan. Contact payplan or cccs for help in putting a debt management plan together.

It depends on what your priorities are - are you focussing on the cc debt as you want to still have a credit line and no bad credit? Or do you just feel you "have" to pay them the usual monthly payment?per month to this debt.

The only way to find out about interest only mortgage is to speak directly to your lender. But since the economy downturn all lenders are obliged under new industry and government guidelines to do EVERYTHING possible to avoid a home being repossessed. If going interest only is an option which should help you keep your home and ease financial hardship then they should agree to it. If they don't there are many ways you can kick up a fuss and official bodies to complain to.

But first of all you need to assess your overall debt situation. How much cc debt do you have, to how many companies, and how much are you paying per month to this debt? By any chance are any of these cc's in your husband's name and not yours? Sounds silly, but lots of women in your situation take on all the old household bills on breakup when some might not even be in their name! Do you have any loans/catalogue/utility arrears?

There is a good chance you can get the cc debt (and any other debt) payments lowered, and have interest and charges frozen on a debt management plan while going interest only on your mortgate.

Glad

Hi, Martin’s asked me to post this in these circumstances: I’ve asked Board Guides to move threads if they’ll receive a better response elsewhere(please see this rule) so this post/thread has been moved to another board, where it should get more replies. If you have any questions about this policy please email [EMAIL="abuse@moneysavingexpert.com"]abuse@moneysavingexpert.com[/EMAIL].

rose28454

JoJoB wrote: »

Someone with more expertise will be along soon but I would say focus on your mortgage repayments/arrears as opposed to clearing your cc debts. If any payments need to be renegotiated lower then it is those.

The priority debts to keep on top of are mortgage and council tax as the consequences of arrears with either of those are the most serious/result in the most upheaval.

Post your financial statement up on the debt board (all your incomings and outgoings) and see if there are any obvious places to save. Whatever surplus (no matter how little) there is after paying your PRIORITY bills should be offered to the cc companies as part of a debt management plan. Contact payplan or cccs for help in putting a debt management plan together.

It depends on what your priorities are - are you focussing on the cc debt as you want to still have a credit line and no bad credit? Or do you just feel you "have" to pay them the usual monthly payment?per month to this debt.

The only way to find out about interest only mortgage is to speak directly to your lender. But since the economy downturn all lenders are obliged under new industry and government guidelines to do EVERYTHING possible to avoid a home being repossessed. If going interest only is an option which should help you keep your home and ease financial hardship then they should agree to it. If they don't there are many ways you can kick up a fuss and official bodies to complain to.

But first of all you need to assess your overall debt situation. How much cc debt do you have, to how many companies, and how much are you paying per month to this debt? By any chance are any of these cc's in your husband's name and not yours? Sounds silly, but lots of women in your situation take on all the old household bills on breakup when some might not even be in their name! Do you have any loans/catalogue/utility arrears?

There is a good chance you can get the cc debt (and any other debt) payments lowered, and have interest and charges frozen on a debt management plan while going interest only on your mortgate.

I am only paying the Mortgage company and 1 of the CC companies that have the 1st charging order. My Council Tax is up to date. I have spoken to the debt advisors company CCCS who said I dont have enough incme to cover my debts and should go bankrupt. I am self employed as a bookkeeper/caterer and my work is sporadic at present. Most months I manage to pay my mortgage and struggle with my other bills. Most of the credit card debt is in my name ( I was trying to prop up my marriage and keep my home) and at present most are with debt collectors and I am ging down the CCA route with some success. I would rather not post my SOA on here as I have been subject to some harrasment in the past. Suffice to say I quite money savvy now ( thanks to MSE) and just need a little help getting to the point of selling the house to solve all the debt problems. I have pulled out all my building society statements and reckon the interest only payment would be less than half what I pay now. I am going to call their head office in the morning. thanks

catieeb06

I'm not sure who your mortgage company is but as a mortgage advisor for LBG I know that the financial difficulties team can put you onto an interest only mortgage for a short period of time, 6-12 months ish, and then once you've made 6 consecutive monthly mortgage payments either on interest only or the full repayment basis then you can look to capitalise the arrears back onto the mortgage.

Approach your lender, inform them that your in financial difficulties and find out what they're options are. They may offer you interest only without a repayment vehicle behind you or they may look to extend your mortgage term, another alternative is that they may even come to a repayment arrangement.

Won't hurt to give them a call in the morning and ask them. That way it's a weight off your shoulders and they are being informed of your situation.

Hope that helps xx