Wanting to switch to an IO mortgage....

moments_of_sanity

I want to switch to an interest only mortgage. My husband inherited a property recently with his Brother, this is valued at £300,000 and they have decided to rent it for a while as it's not sold in 8 months.

Our mortage is a little over £98,000 and our property is valued at £220,000 so we have a nice bit of equity in it. I spoke to the Nationwide today and they won't take my Husbands 'inherited' home as a way of paying back the mortgage or the fact that we have a nice amount of equity in our home.

What things do we need in place to satisfy the banks that we can pay it back - we have £270,000 worth of property but that's not sufficient for them!!!

We would like to change to IO as Hubby had to take 3 months unpaid leave from work to look after his terminally ill Mum and it has wiped out everything we had saved plus more!

Thrugelmir

moments_of_sanity wrote: »

What things do we need in place to satisfy the banks that we can pay it back - we have £270,000 worth of property but that's not sufficient for them!!!

An alternative repayment vehicle or maintain the repayment mortgage.

Lower the price of the property to sell it. At the moment its more likely to lose rather than make you money.

I'm not unsympathetic to your cause. However its your issues to resolve not the NW's.

moments_of_sanity

Thrugelmir wrote: »

An alternative repayment vehicle or maintain the repayment mortgage.

Lower the price of the property to sell it. At the moment its more likely to lose rather than make you money.

I'm not unsympathetic to your cause. However its your issues to resolve not the NW's.

My problem is that they haven't made it clear what they want us to provide for them???

We aren't selling the property as it started at £340,000 and in 8 months has reduced to £300,000 - not going to give the house away!!!

ViolaLass

Thrugelmir wrote: »

An alternative repayment vehicle or maintain the repayment mortgage.

Why wouldn't the other house do as an alternative repayment vehicle? Apart from the bank not having to help if it doesn't want to, I don't understand why this proposal hasn't been accepted.

moments_of_sanity

ViolaLass wrote: »

Why wouldn't the other house do as an alternative repayment vehicle? Apart from the bank not having to help if it doesn't want to, I don't understand why this proposal hasn't been accepted.

Because it is owned by my Hubby and his Brother they won't accept that as alternative payment vehicle as they say they may not be able to get their money back. It has to be in Hubby's name only.

ViolaLass

I see.

Bit bemused at the OP answering that though - you came on here to ask the question!

moments_of_sanity

ViolaLass wrote: »

I see.

Bit bemused at the OP answering that though - you came on here to ask the question!

I am just a bit bemused by what 'evidence' they need, they say pensions/ISA's/endowements etc but surely these are as high if not higher risk than using the second property as the repayment vehicle even if it is jointly owned by Hubby's Brother?

ViolaLass

From what you say, it seems that they would be perfectly happy to accept the house, if your husband owned it completely. I don't see why a pension, for example, would be higher risk than a house.