This is a tricky one...

watcher27

Right, hi all
This is my first post and i hope it makes sense!

Basically, our mortgage repayments are shooting up from £460 to £1035 in 2 months time, which we cannot pay
Our mortgage is with Northern Rock and out deal is coming to an end in November along with the end of our "interest only" 1 year agreement we have with them, which we asked for because we i was made redundant.

Our house has just been valued at £160K, but our mortgage is for £190K.
My mortgage adviser explained we are in the old part of northern rock, which is acting as a sort of "holding pen" for 125% mortgages & high risk etc that they cant shift. We cant move to another provider unless we can magic £60K odd, so are a bit stuffed!

I have an idea that i am thinking about as a last resort, but just want to see if it is at all possible?

My mum's house (here we go) is worth approx £360K and has no mortgage. Obviously this is all dependant on a few things, including my mum agreeing, but what if we got a full mortgage out on my mums to pay ours off completely? And as my mum's is worth approx. twice the amount of our's, we wouldn't need any deposit! And then we could get it fixed for life at todays low interest rates???

Is this something that can be done, or is it a daft idea?

Many thanks guys

silvercar

I don't know that I would put my Mum in such debt!

That aside, if the deeds are held in your Mum's name then your Mum needs to have sufficient income to justify a mortgage of whatever size you need.

haras_nosirrah

Hi

You can't get a mortgage on someone elses house. The mortgage and deeds of the property need to match.

Your mum could release equity from her house to help you out but then legally she would be responsible for paying it back.

This would be asking an awful lot from your mum.

wymondham

As you've known this moment was coming for the last year, what provisions have you already put in place in this period?

Thrugelmir

watcher27 wrote: »

My mortgage adviser explained we are in the old part of northern rock, which is acting as a sort of "holding pen" for 125% mortgages & high risk etc that they cant shift. We cant move to another provider unless we can magic £60K odd, so are a bit stuffed!

The old NR raised funds on the wholesale markets by securitising and selling on its mortgage book. NR was split on the basis on whether a mortgage was securitised or non-securitised.

So has nothing to do with your own personal circumstances.

Securitised mortgages have to be retained in "bad" bank. As somebody is owed the capital balance on your mortgage.

foreversummer

For goodness sake, do not put your mum in this position. It is really not fair of you to ask.

If you are old enough and mature enough to have your own mortgage, you need to learn to stand on your own two feet.

I'm sorry to sound harsh.

Foreversummer

watcher27

I feel we may have gotten off on the wrong foot here

Firstly, and most importantly I would NEVER do anything that would put my mums home at risk. Period!
Mortgages in general go right over my head, so I didn't know how or if this could be done or if it could be secured on our house, I don't know, which is why I asked. I only thought of it based on something the estate agent said when he came to value the house. And even then, it would have been a very end of the line last resort prior to repossession.

Judging by the hostile responses, I seem to have given the impression that im a money grabbing !!!!-hole who would rob his own mother of her house! Which I can assure you I am not :mad:

I have had countless loans & purchases on credit etc since I was 18 (im now 30, but only just) and have NEVER EVER missed any payments etc and have always paid them all off in full. My credit rating is as high as it can be. I consider paying my debts & bill's a top priority and prioritise them even over food, but I have never got myself in a situation where i've had too, until now...:cool:

So, forgetting the idea of my mums house then, someone here stated that as id known this was going to happen, I should have prepared for it.
Truth be told, i SHOULD have known about this, but to be honest i didn't
2009/2010 have been a rough ride, wife had to drop from full time to part time to look after our baby boy, i've been made redundant twice, I have another job now but it's a considerable amount less then I was on before. And the mortgage was put to the back of my mind, I was aware the interest only was coming to an end, but not the mortgage deal.

I can reapply to go on interest only, which we can just about manage if accepted, but thats not a long term solution

opinions4u

You are where you are, and circumstances around employment haven't helped you.

The fact that you are asking the question a couple of months ahead of the inevitable is a good thing. While some of the answers above may be blunt, don't take them to heart. They may actually turn out to be good pointers should you ever find yourself in a similar situation in future.

I actually understand the logic behind your idea of using equity in your Mum's house. If she could raise £90k ish and effectively hand this to you it would open up a range of remortgage deals for you. But she would have to be able to meet the payments on this debt in her own right.

Reading between the lines, I think your suggestion about continuing on interest only for the time being (is the lender allows) is probably the best option. Scrimping and saving to make overpayments wherever possible. If you've got other loan commitments that are coming to an end at some point you can then redirect these payments to the mortgage debt.

At the other extreme end of the spectrum is handing the keys back in. You'll probably never own a house with a mortgage again though and they can still pursue you for any shortfall, costs and interest once the house is sold.

For now? Make sure you can get on interest only for an extended period and then get over to the Debt-Free Wannabe part of this forum where you can get help with restraining your spending, increasing your incomes and hopefully find ways to manage your debts down over time.

Good luck. It's won't be easy but you will probably be ok in time.

watcher27

opinions4u wrote: »

You are where you are, and circumstances around employment haven't helped you.

The fact that you are asking the question a couple of months ahead of the inevitable is a good thing. While some of the answers above may be blunt, don't take them to heart. They may actually turn out to be good pointers should you ever find yourself in a similar situation in future.

I actually understand the logic behind your idea of using equity in your Mum's house. If she could raise £90k ish and effectively hand this to you it would open up a range of remortgage deals for you. But she would have to be able to meet the payments on this debt in her own right.

Reading between the lines, I think your suggestion about continuing on interest only for the time being (is the lender allows) is probably the best option. Scrimping and saving to make overpayments wherever possible. If you've got other loan commitments that are coming to an end at some point you can then redirect these payments to the mortgage debt.

At the other extreme end of the spectrum is handing the keys back in. You'll probably never own a house with a mortgage again though and they can still pursue you for any shortfall, costs and interest once the house is sold.

For now? Make sure you can get on interest only for an extended period and then get over to the Debt-Free Wannabe part of this forum where you can get help with restraining your spending, increasing your incomes and hopefully find ways to manage your debts down over time.

Good luck. It's won't be easy but you will probably be ok in time.

At last, someone who understands! :T
Another thing i forgot to reiterate, is that my mum would never have had to pay a penny, all payment's etc would have be paid by us. But i understand now, that to get the money, my mum would need to technically be able to make the payments, even though she would'nt be paying them?! But anyway, not going down that road...

My dad has offered to use some of his pension money, but like i told him, i really dont want to get anyone else involved in this! So declined his offer.

One option we have, that again was mentioned by the estate agent, was to rent our house out for around £700 and move back in with my mum temorarily till either i get a better paid job or my wife can return full time etc.

Im not loosing that house, it's our home and my little boys home and i'll do what ever it takes for his sake. :embarasse

getmore4less

watcher27 wrote: »

I can reapply to go on interest only, which we can just about manage if accepted, but thats not a long term solution

Do it, Apply

You need an immediate solution to the problem that allows you to avoid any defaults.

The long term solution can then take a bit of time in the breathing space continuing I/O gives you.

TrickyDicky101

If you have the option to rent it out and move in with your Mum then I think that sounds very sensible - that way your mother's house isn't at risk and you can presumably make some form of overpayments on your mortgage to try and clear as much of it as possible (I'm assuming that Mum wouldn't charge you rent).

EDIT: I agree with the interest only option to as an immediate fix.