Mortgage after DMP

Daisy4478

We have been in our DMP for 18 months. We have a really good tracker mortgage with Birmingham Midshires which at the minute is 0.25% above base rate. In Feb 2011 this finishes and the mortgage changes to 2.25% above base rate. This will still be good so long as the base rate stays below 3% but i worry what will happen after this. Will we be able to swap mortgages (which we always have done for the last 11 years) when the rate finishes or will we have problems due to the DMP? Also, if we stay with the same provider, can we change mortgage product? If so, will they do another credit check. If they do and see we are now in the DMP, can they withdraw our current mortgage?

Sorry for all the questions but our FSA who was brilliant suddenly last year and we have yet to find another.

Thanks

Lisa :0)

poppy10_2

How much equity do you have?

Senior_Paper_Monitor

Unlikely to give you a new product (not impossible but unlikely - and can't see them improving it) but as long as you make the monthly payments (i.e stick to the contract) they cannot get you out/terminate the mortgage.

Daisy4478

Thanks both.

We put the house on the market to sell and try to avoid the DMP about 3 years ago when there was about 50k equity however the house didn't sell and the market dropped and we kept dropping the price till there was only 10k equity in which case i thought that there was no point in selling as the money would only only pay moving fees and wouldn't release any money to pay off the debts.

I had a quick look online at the mortgaes on offer at the minute and ours still doesn't look like too bad a deal.

poppy10_2

In that case you are unlikely to be able to get a new deal, but will automatically go onto Birmingham Midshire's SVR (currently 2.75%) when your current tracker deal ends in Feb 2011. You won't need a new credit check and they won't just withdraw the mortgage altogether. As you say, 2.75% is still a very competitive rate. Presumably you have been overpaying your mortgage while you have been paying just 0.75% interest over the last year.

Daisy4478

No as we were unable to make overpayments with our mortgage however we have been using to to pay of more of the debt. I had postnatal depression after both of my children and had to stop work. I am back at work but until the youngest starts full time school next September i can only do a few shifts at the local supermarket as childcare cost were almost 1k a month so have to fit in around the other halfs work and the kids.

Thrugelmir

Daisy4478 wrote: »

No as we were unable to make overpayments with our mortgage however we have been using to to pay of more of the debt. I had postnatal depression after both of my children and had to stop work. I am back at work but until the youngest starts full time school next September i can only do a few shifts at the local supermarket as childcare cost were almost 1k a month so have to fit in around the other halfs work and the kids.

You are on a good rate of interest. Even as rates rise in the future it'll still be competitive. The low rates of the previous few years have gone forever.

Seems as if your tackling your problems the right way. May seem a long road ahead but stick with it and you'll get there in the end.

Daisy4478

Thanks. Its not been an easy road but we're getting there!