Mortgage won't be paid off...help!

Devils_Avocado

This is worrying me somewhat. With 7 years and £80,000 left on my mortgage I suffered from major heart problems with the result that I'm no longer working.

I had to switch the mortgage to interest only. I'm with CCCS who have been very helpful in negotiating with my creditors to accept token payments, but these payments are minimal. I'm in receipt of pension credit, but their payments on the mortage interest are still £80 short every month, so I'm car booting stuff to make up the difference.

My mortgage is over a 25 year term and due to be paid up in 6 years.

Will they boot me out or force me to sell my property?

opinions4u

How much is the property worth?

Would it be such a bad thing to sell up and move to a smaller home?

Could you afford interest only payments on the £80k and would the lender be prepared to consider this long term?

Crinz

If it came down to it you would ideally sell the property yourself rather than let the bank do it for you. You will be tens of thousands worse off if you get repo'd.

Why pay interest only for 6 years when you will have to pay lump sum anyway? Could you not sell and buy outright??

Devils_Avocado

opinions4u wrote: »

How much is the property worth?

Would it be such a bad thing to sell up and move to a smaller home?

Could you afford interest only payments on the £80k and would the lender be prepared to consider this long term?

The value of my property is around 170k. I don't want to move but accept that I may have to. I'll be 70 by the time the 25 year term ends.

If my pension credit tops up some of my mortage interest payments, and the BS are prepared to extend the term indefinitely, then I'd be better off staying put.

Devils_Avocado

opinions4u wrote: »

How much is the property worth?

Would it be such a bad thing to sell up and move to a smaller home?

Could you afford interest only payments on the £80k and would the lender be prepared to consider this long term?

The value of my property is around 170k. I don't want to move but accept that I may have to. I'll be 70 by the time the 25 year term ends.

If my pension credit tops up some of my mortage interest payments, and the BS are prepared to extend the term indefinitely, then I may be better off staying put.

But that's the big question - what is the policy of building societies in such a situation?

dunstonh

The lenders will often extend the borrowing whilst you are paying the interest. you can get away with that for a few years normally.

Once you get to your late 50s you could then look to equity release. Or face up to the fact that what you want and what you may have to put up with are two different things (harsh but then reality often is).

One assumes that you didnt have any critical illness cover on your life assurance?

Radiantsoul

Devils_Avocado wrote: »

But that's the big question - what is the policy of building societies in such a situation?

Depends on the building society is the only answer. They are being quite sympathethic it seems to me, but generally they are not going to be keen on interest only forever. If they were to go to court they would get possession for the property unless you are able to repay the loan within the original term.

I think you probably need to consider moving.

Crinz

if you are looking for interest only indefinately then you would be looking for a lifetime mortgage.

any independants confirm if these still exist? I know my company closed all the retirement home plan mortgages a good few years ago.

Generally you will struggle to get a mortgage past 75 at the moment.

opinions4u

Crinz wrote: »

I know my company closed all the retirement home plan mortgages a good few years ago.

I thought that too. Then, through these pages, discovered that RHP is still available via the introduced market.

They simply didn't want to spend the money on making sure their own sales force could market the product compliantly!

Crinz

opinions4u wrote: »

I thought that too. Then, through these pages, discovered that RHP is still available via the introduced market.

They simply didn't want to spend the money on making sure their own sales force could market the product compliantly!

this is very true, non-advised mortgage consultants are not allowed to even see these (existing) customers and fully cemap qualified MA's have to do so on non-advised basis.

its a bit of a minefield


so there we have it anyway, RHP may be an option for OP

getmore4less

Devils_Avocado wrote: »

This is worrying me somewhat. With 7 years and £80,000 left on my mortgage I suffered from major heart problems with the result that I'm no longer working.

I had to switch the mortgage to interest only. I'm with CCCS who have been very helpful in negotiating with my creditors to accept token payments, but these payments are minimal. I'm in receipt of pension credit, but their payments on the mortage interest are still £80 short every month, so I'm car booting stuff to make up the difference.

My mortgage is over a 25 year term and due to be paid up in 6 years.

Will they boot me out or force me to sell my property?

The thing is you have a major change,

The original plan for retirement is no longer going to work so you need to have a long term plan that will work.

Hanging onto this house now could be a big mistate with £80k of debt and no way to repay it.


You also need to consider how your health will be over the years will stairs become a problem will you need more help etc.


Any changes really need to be done once and hope you get it right with some carefull planning.

It might even be worth considering selling and renting and anjoy some of the equity you do have while you can if health is going to be an issue.


Look at all options and try not to be fixated on keeping the house at any cost only do it if you can have aplan that works.

Any family?