Can I/Should I switch to interest only?

Wh05apk

Thrugelmir wrote: »

Basic check to substantiate the application for change in terms.

An underwriter would need the full facts in order to make a considered decision.

They would need the full facts, but they would not do a credit check.

Thrugelmir

Wh05apk wrote: »

They would need the full facts, but they would not do a credit check.

A credit check to establish indebtedness is a critical fact.

Wh05apk

Thrugelmir wrote: »

A credit check to establish indebtedness is a critical fact.

They would not do a credit check for a change of repayment type, they would look at the conduct of the mortgage, along with the info provided, if necessary confirming by bank statements.

jellybean09

What happened to the £3k ? Up/down, on the nags instead ?

That wasnt my cash it was posted on behalf of my father. I would loved to have had that £3000 hanging around. Unfortunately not. Turns out he decided against going for the shares and now wishes he had! lol

jellybean09

Wh05apk wrote: »

Are you still in negative equity?

Unfortunately yes, we had the house valued in Sept and the agents agreed 90k at a push. A house over the road (same spec) sold for 68k after being on the market at 90k for over a year. We owe NR 110k (just checked docs)

We bought at the wrong time. The idea was buy the house on 100% (such a bad decision looking back), use the loan money to get it back to standard and then resell. We would have had to pay NR a fee but the idea was it would have been worth it and we ideally would have made enough profit to have a cash deposit for the next house. Prices were looking good and we were getting it done nicely, then it crashed....prices dropped signficantly in our area, we are in negative equity for the forseeable....

jellybean09

Thrugelmir wrote: »

Would switching to interest only for 12 months make a signficant reduction in monthly outgoings to realistically make an impact on your debts?

Or would it merely make life more manageable?
.

Yes it would. Even if we saved £100 over the 12 months, that £1200 could pay for 3 debts, the amounts we owe arent huge but the monthly repayments added up makes a big difference. We would then bet better off each month by nearly £200. Failing that its a case of continuing paying rolling interest on those debts as well as our mortgage and waiting until they are paid off (these 3 are between 12-18 months). We could do it, just. That saving could then contribute to overpayments on the mortgage (not the whole amount as we wouldnt be ny better off) but to try and make up as much as possible from what we lost on this 12 months if that makes sense?

I considered the interest only switch as a way to try and save on interest and get us on a better footing much faster.

hcb42

dont go interest only., read the other threads. If £100 a month clears three debts then concentrate on small savings elsewhere, or sell a few items...