£20k loan - with one applicant on benefits?

D2007

I've posted a thread in the mortgage section but it is loan/mortgage related so I thought I'd post it here too.

Full thread - long!
http://forums.moneysavingexpert.com/showthread.html?p=3786210#post3786210

Basically my mum has a £20k interest only mortgage at 7% variable. Myself and my brother are considering taking a loan out for £20k at a lower fixed percentage to pay it off (with interest rates looking to rise that 7% will no doubt shoot up even more). As my mum is on incapcity benefit and is unlikely to return to work. We've kept the endowment policy as she has an early stage of one of the illness that are covered on the policy.

Does anyone know the best places to look for a fixed percentage loan and also whether my mum could be included on the loan (even though she is unemployed and on incapity benefit - basically so that the benefits agency doesn't think because her mortgage is paid off she has more income than she does so reduces her benefits).

Also any calculators to help calculate what amount / term would be best for us. We are thinking of paying back £300 to £500 a month as we could easily afford that.

Thanks for any help

Madiba_2

I doubt the base rate will rise to 7% any time soon, but who knows!

Abbey do a rate of 5.8%, but you could also try Zopa.com

D2007

Madiba wrote:

I doubt the base rate will rise to 7% any time soon, but who knows!

Abbey do a rate of 5.8%, but you could also try Zopa.com

Sorry not the base rate, we are already paying 7% on our mortgage as the deal ended a while back. But with my mum being ill and unlikely to be able to get another mortgage I guess we are stuck paying interest at 7%. So if we are paying 7% now it'll no doubt increase further when the rates rise next year. Hence the reason for me wanting just a fixed loan to pay it off as we'd be paying the capital off and no doubt it won't be any worse than the percentage of interest we are paying now. So long term we'd better off.

Thanks, I'll give Zopa a try.