abbey flexible plus mortgage (cant get further advance !)

derby1

Hi all
I have an abbey flexible mortgage .49% over base very nice !!!
the problem i have is i wish to have an extra advance witch in there terms and conditions i can ask for . They say that i will only be considered for a further advance if i switch to a repayment mortgage .i feel this is in breach of there own t and c's
so i am asking if they can release me from there condition that i can ask for a further advance(paragraph 19.2 2007 edition ) if they release me i can then get a second mortgage from another provider ... has any one else had this issue?

Thrugelmir

derby1 wrote: »

They say that i will only be considered for a further advance if i switch to a repayment mortgage .i feel this is in breach of there own t and c's

On what grounds is it a breach?

derby1

well because they will not advance me further money unless i change to a repayment mortgage this is not what is in my t and cs .....

Wappers

Meeting their current lending criteria will be in the T&Cs, I suspect you don't meet their current criteria for interest only.

Thrugelmir

derby1 wrote: »

well because they will not advance me further money unless i change to a repayment mortgage this is not what is in my t and cs .....

You would like a further advance. So this will need to comply with their current lending terms. There are no grounds for complaint.

Choice is yours. Either accept or seek a new lender.

Senior_Paper_Monitor

What is your current LTV - and what is your repayment vehicle (how will you pay off the mortgage at end of term)?

derby1

I meet there lending criteria the ltv is 57% it is just they do not want to lend at .99% and i cant blame them !! i have a letter from them saying that if i change the interest rate to a higher one they may lend. the thing is that is not in there t and c that for a further advance i need to change my interest rate.

GMS

Maximum LTV for interest only is 50% now having recently changed so you do not meet lending criteria.

Your current rate is fantastic and not obtainable elsewhere. Now is the time to overpay and get the balance down as much as possible.

If you really need a further advance then you would have to go elsewhere and forego the rate and probably need to switch to repayment at the same time. Other option would be to look at a second charge secured loan. Rates will be much higher than you pay now but would allow you to keep the rate you have. All depends on the figures which way works best.

Do you have a repayment vehicle in place for the interest only loan?

SandC

Derby their T&Cs will only state that you may ask for a further advance - not that you will be given one, or if you are, on what terms. Just that you can ask.

Brock_and_Roll

Given that Abbey is part of Santander, I would be surprised if they want to lend any more money at any rate, if indeed thay have any cash earmarked as available to lend!!!

JimmyTheWig

That's a great rate you're on. You'd be crazy to lose it.
Presumably the new lending won't be at that rate, whatever they agree to?
You need to find out why they are refusing to lend you more money with you staying on interest-only. If they say that you don't meet their lending criteria then ask what criteria you don't meet.
I'm not particularly surprised at the decision, but it is worth following it up (a) so that you know and understand and (b) in case they have made a mistake somewhere along the line.

Assuming that they haven't made a mistake then what to do will depend on various factors, such as how much is outstanding and how much extra you want to borrow.

But the big question is how you are repaying the original mortgage. I hope that you do have a repayment vehicle in place.
If this is the case then an interest-only mortgage is ideal as it will be very easy to get a return of more than 1% from it.
If you haven't made any inroads to repaying the mortgage then I think you will find yourself in trouble, sooner or later.

Maybe you are paying money into a cash ISA with a view to using this to repay the mortgage when it is due.
If so, do you have enough money in this ISA to withdraw so that you don't actually need to borrow any more? This would only be worthwhile if you are able to up your payments into the ISA to build up the pot to where it would have been otherwise.