Want to change but new FSA rules stop us?

jeannieblue

Son and I were about to change our mortgage to another company, and save approx £200 in monthly payments as the rate would be lower. Advisor told us that this would not be a problem - but we were refused due to my being to old! (Indignant!!) He said that the FSA had brought out new rules and that we would not, therefore, be able to change over to another mortgage provider.

Is this correct? I mean, already have the mortgage! Decrepit though I may be.....

Thrugelmir

Need some facts to comment.

Your age?
Mortgage term?
Mortgage amount?

The web is anonymous.

dunstonh

There are no new FSA rules on mortgages. The only thing the FSA has done on mortgages is to remind lenders to be sensible on lending decisions. Advisers were also warned to take more care.

There are no rules on going past retirement. It is a lending decision as it always has been. If the lender feels you can afford the payments post retirement then they will lend. If they dont, then they will not lend.

If your existing mortgage already goes past retirement then it doesnt make it right to lend again on a new mortgage on the same basis (each one is treated independently of the other). The new lender carries the liability going forward. Not the old one.

I would suggest you use that £200pm saving to reduce the mortgage term so it ends before your pension scheme retirement age.


(some of the above is assumed based only on the limited information give)

jeannieblue

I can collect my pension next year - but no intention of packing up work. Even if I did, pension would cover current payments. Son is 31.

Currently pay £849 per month on mortgage, term 21 years on fixed rate of 5.63 fixed term. The offer that was turned down, would have reduced the payments to about £650 per month.

I can see where they are coming from and see me with one foot in the grave... but do have life insurance and mortgage is under half the value of the property - so I'm not sure where the risk is.

jeannieblue

Only other possible way is to see if could get mortgage in son's name only?

Thrugelmir

jeannieblue wrote: »

Only other possible way is to see if could get mortgage in son's name only?

Or switch mortgage product with your existing lender.

If you have money in savings may be worth paying down your mortgage now. While you are still working.

jeannieblue

Will see what they say re son his own - but as we co own property, that could be difficult. It was originally. Doom and gloom!
thanks for the advice guys!