Need a mortgage but income small and variable

Oliverjames_2

I have an endowment mortgage which needs to be paid off in dec this year. The endowment part paid off and was paid into the account leaving a shortfall of £4000 to pay off 31 dec. My main income is £740 a month in benefits (i have been in a wheelchair 30yrs and i am now 56) and income from a holiday cottage of about £4000 a year. my property is worth about £350,000 and I have a £10,000 5 year personal loan with 3yrs to go and £4000 on credit cards. No-one will offer me another mortgage even though I have a good credit score and a lot of equity in the house. Any ideas?

bobajob_1966

How much equity do you have? Can you not downsize?

Oliverjames_2

No I desperately want ti stay where I am. The house is adapted for me, nothing in this area sells very quickly anyway and if poss I could do with some house repairs too - rewire and a bit of decorating!

whatyadoinsucka

to downsize seems the sensible option, release the equity and have a nest egg to sit back on in your retirement.. you don't state where you live, is £350k likely to be a saleable price in current conditions, you could buy a very nice house (fully adapted) in 80% of the uk with half that amount.

again you don't mention family, if you are on your own living on benefits in a expensive property downsizing would save considerably on monthly outgoings.

you did well to get a £10k loan back in 2009 on a repayment of 20-25% of your income (not disposable income), did the bank not check your income, or do they want you to default (its not secured is it).

maninthestreet

You can't get a mortgage for a sum as low as £4,000, regardless of your income. How have you managed to get an unsecured loan for £10,000 in 2009 based on such a small annual income? You own TWO properties - how much is the holiday property worth? Do you own it outright, or is it mortgaged?

Annisele

Have you spoken to your existing lender? Sometimes banks are prepared to extend the term on existing mortgages (especially when an endowment has fallen short).

Banks tend not to want to repossess over a debt of only £4k; generally they'd prefer to extend the term a little and convert to repayment.

Who is your lender? Some are more sympathetic than others.

kingstreet

I would also suggest downsizing and repaying all your debt. If you aren't prepared to do this, my suggestion is as follows.

Ask your current mortgage lender if you can extend the term of the interest-only mortgage. If you only owe £4,000 you must be paying around £16 per month?

Once the loan is paid off in three years, use the loan payments you were making to pay off the credit card debt, when that's gone, use the money to repay the mortgage.

Oliverjames_2

I only have one daughter I rarely see. I have no other family at all. I got the loan adding together benefits and holiday income which was better then - v bad year last year. I have paid £201 a month repayments on it.
My lender is Lloyds. I rang this week to see if I could extend the mortgage and add a bit more but was on the phone 40mins and passed between about 5 people. The last one took details, said they had my date of birth wrong so refused to talk to me any more. I was told to go to a branch. The only 2 branches of lloydstsb are 6 miles or 10miles and both have steps and no wheelchair access. (which i am sure is illegal) Good eh?

Annisele

I'd be surprised if they'd let you "add a bit more" - and I'd suggest that increasing your secured debt is probably a very bad idea at the moment.

Why don't you write to them and ask if they will extend the term?

Oliverjames_2

I think that is what I will have to do. My holiday let is an annexe to the house so not a property on it's own. I want to stay as here I do at least see people come and go. I couldn't bear to be shut in a bungalow on my own all day! My outgoings are tiny as I can't get out at all so just electric council tax and food and making an attempt to pay past debts (which are mostly house repairs). Just have to hope next year is a better year!

knightstyle

In the short term a credit card 0% deal or low interest loan. BUT this is just to keep you in your house while you sort out a long term solution.
Could you live with someone else renting a room or have you a garage to let? IMO you will need extra income to support a mortgage.