Questions about Death, and the Mortgage that is left..

catz42

Hello all!
Firstly, let me say even though my husband is ill, and no one knows really what is going to happen for certain, I still wanted some advice regarding the mortgage. As to be prepared is the best option, we have children living at home. Hubby has not been able to get life insurance after his heart attacks. Had the mortgage for nearly 4 yrs.
The mortgage is in my husbands name only, we did some home work a few months back, that if he dies, then the bank will expect me to take over repayments. My wage would not cover this mortgage payment alone (never mind all the utility bills) so, our mortgage as it stand is a repayment one (locked for 5 yrs) would I be able to change this into a Interest only mortgage if it the debt was passed to me? (when we looked at this option, it was around £400 a month instead of £850), but my husband is proud and wanted a repayment one even though he knows his clock is ticking.) I know I'd be paying interest until the cows come home, but it would allow the family to still live as a family. And also give me time to sell the house if we still could not cover costs.

He has credit card balances outstanding, would I be likely for these too? I never though we'd ever be in a position where I'd have to worry about the future home, he has always been the main provider.
Any help would be very gratefully recieved.
Thanks.

mgdavid

do not lenders insist on continuous life insurance to cover the mortgage debt? they certainly did when I took mine out (many years ago).
Is your OH employed, does he get life insurance as part of his package?
(many do).

ACG

mgdavid - life insurance isnt compulsary anymore.

With regards to the OP.
Not all lenders will allow you to transfer to Interest Only - some will but it has become a lot stricter in recent months. They may allow it for a temporary period whilst you sell the house or look for an alternative (maybe extend the term...but that probably wont do enough).

You should speak to the company now and try to get something in writing maybe?
Is your husbands will set up and all in order? If not ensure it is and do it with a solicitor or Will writer if possible - (im not advertising) but out company does it for around £100-150 - to give you a guide.

your husbands credit card debts (im really sorry for the terminology here, this is just a wording i used when i worked for RBS credit cards) die with him, however the debts may be requested from his estate - any money in his bank accounts etc, they wont carry on for you to pay.

I dont think there will be a lot you can do with the mortgage unless the lender plays ball but even then i think you will be delaying the inevitable - you should probably start to accept that you may have to downsize/downgrade your home.

I know its a bit late, but its precisely this reason why life insurance is sold. No insurer will accept the risk once somethign serious has happened it has to be done before hand - the healthier the better.

catz42

Thankyou both. I am going to get on the ball, see what options would be available, even if I know for sure what I'd be faced with, it would be easier than waiting. Also I think a Will is in order, not just for him, but myself too.
Thanks again.

sammyjammy

If your name is not on the mortgage and your husband dies then I believe the mortgage company will want to sell your house to recover the debt. You cannot take over a mortgage that you are not part of. Its possible you would able to take out your own mortgage in order to repay the debt but if you went interest only you would be required to supply evidence of a vehicle to repay the debt.

Thrugelmir

sammyjammy wrote: »

If your name is not on the mortgage and your husband dies then I believe the mortgage company will want to sell your house to recover the debt.

Will be an asset of the estate. From which other creditors will need to be paid (i.e. credit cards ).

Suggest you speak to your lender. Explain the situation. Ask to be moved onto interest only. Then use the extra money to repay the most expensive debt first.