Extending and Reducing Term of Mortgage

kly_3

Hi,
I am looking to extend the term of my mortgage with Santander to temporarily reduce my mortgage payments and then next year I will be looking to reduce back to the shorter term. Santander have advised that the switch back to to reduced term will not need to be reviewed and my money situation will not need to be reassessed. This does not sound right to me. The switch is only for a short while to get ourselves straight and then we want to switch back as we only have 13 years left on our mortgage. We don't want to be stuck in a 35 year mortgage so can anyone advise if this is really the case or are they just trying to get more out of me in the longer term?
Thanks

JimmyTheWig

I don't know if what they say is true (though in some ways I'm surprised), but in any case you are allowed to make overpayments which you can use to bring down the term of your mortgage.
If you are in a tied-in period then you're limited to overpaying 10% of the mortgage balance in any year, but that shouldn't be a problem, at least for now.

So if they don't let you reduce the term again then just overpay by the amount the payments have reduced by.

Thrugelmir

Have they offered to accept reduced payments for a period of time. This is different to changing the contractual term. As this you will be charged for.

Your credit record will be marked as a result of this request.

kly_3

Thank you both for your replies.

Thrugelmir - I am not changing the contract terms on the length of the mortgage for which there is no charge. I did this simply in a 10 minute call with them and I now just have to return the signed documents. They have advised that the switch back will be exactly the same process again with no charge. My only concern is that they will not let me switch back to the shorter term (back from 35 years to 13 years) and then I am stuck paying back my mortgage until I retire. They have advised that as it is only the length of the mortgage I am changing that there is no need to check my financial situation but I am wary as I can't see if I am telling them I want to extend the term to reduce my payments now how they can so easily accept a call from me in 6 months time telling them the reverse.

I have spoken with 4 different people there and they have all told me the same so now I just can't make up my mind whether to go ahead with it or not??????

JimmyTheWig

You could always ask for it in writing. Then if they try and tell you otherwise when you want to change it back then you've got something to back your side up.
But as I say, with the option to overpay it really doesn't matter.