Help with my mortage?

BFace_2

Hi

I'm hoping someone can help me with my mess of a life!

In May 2008 I bought a flat with my sister, We paid £146k for it but borrowed £161k, part repayment mortage and part loan to cover fees and exisiting debt.

The mortgage was a 3 years fixed rate of an extortionate 7.5%

Then the market crashed.

Next May the fixed rate ends and we had planned to sell the flat but am now not sure that we can without going into negatice equity. We definitely don't want to reside together in the property anymore

According to the last mortgage statement I got my mortgage is now at £137k and the rest is loan I think. The property isn't worth anymore now than when we bought but is about the same according to online valuations.

I am trying to work out if either of us can afford to keep this property on alone.. does anyone know if my mortgage repayment would be likely to come down. I have no idea if this is something anyone could answer for me... should I stay with Santander or go elsewhere?

Could I sell the property to clear the mortgage and just keep the joint loan or are they tied together?

When should I start asking is it too early now?

This is my first property... what a mistake ay?

B

beecher2

Your only option is to stay with Santander as your loan to value is too high to go elsewhere. It would be up to them whether one of you could take the mortgage on - salary multiples would have to stack up. Phone them up and ask what would happen to the loan if you sold up - I know Northern Rock put the interest up significantly.

BFace_2

Thanks Beecher

I actually meant that I would keep the mortgage in both names but would like the payment to come down a fair bit to enable it to be affordable for one of us to leave and rent whilst the other stays and pays the mortgage. But it would need to come down a fair bit and I have no idea if that would happen, I'm just trying to plan for next year

I just wondered if anyone had any experience of paying high interest like mine and then remortgaging recently with the same company....

Thanks for you help

B

TrickyDicky101

I don't think you will have a remortgage option even with your existing lender due to the property being in negative equity (or close to). What did your original documentation state about what rate you would go on to once the fixed period was over? If it's Santander's SVR then you should see some reduction in repayments. It won't be in half though as you still have a heck of a lot of capital to repay whatever the interest rate.

beecher2

You'll be on a variable rate so make sure you don't make decisions according to the rate as it is now, as rates will go up.

BFace_2

Thanks for your advice both of you

Would it be worth me contacting Santander now or is it too early for them to give me accurate advice? My Fixed rate ends May 2nd 2011

B