Interest only ends when I am 65

opinions4u

Is it me? ...

paulo100

Is it me?, quite possibly so...

I have asked a very straight forward question of this forum (does anyone know if NW allow an extension to an interest only mortgage that runs its course in 3.6 years time)? Simple, simple question, no??
With the exception of 3 or 4 board members, who have been exceptionally helpful with their advice and outlining of their own experiences, (thanks again, you know who you are) I have been accused by others of trying to con the NW into 'funding my lifestyle', I have been told to, quote ‘get ready to move, if you think NW are going to wait until you die,(for their money)think again’, and various other slightly aggressive responses where the poster clearly had no intention of trying to be helpful but merely wanted to show how smart they are with their snide responses.
One has to wonder why such a simple and straightforward question would trigger such ill concealed venom? That's a mainly rhetorical question, because those making these posts will hardly open up and respond honestly, if indeed they even know why they are as they are, probably just bitter people ground down by their daily drudge

holly_hobby

paulo100 wrote: »

I have asked a very straight forward question of this forum (does anyone know if NW allow an extension to an interest only mortgage that runs its course in 3.6 years time)? Simple, simple question, no??

In essence unfortunately no, because it will wholly depend upon the lenders evaluation of your particular set of circumstances and financial situation - we can only give you guesstimates as to what they will agree to.

Every one who posts does so (I truly believe) with the intention to help and advise the OP, albeit some members have a more "no-nonsense" style than others .... but please don't feel that peeps aren't here to help where we can, because thats exactly what we try to do, unfortunately our responses to threads aren't always agreeable to the OP, which is where dis-harmony can occur (this is not directed at this thread in particular but general comment).

I can completely appreciate why, although you have the funds to fully repay your mortgage at the scheduled and contractual date of redemption, you would rather extend the term by 5 yrs or so to benefit from your capital achieveing a higher rate of return than you would pay on the continuing mge debt.

Sadly, although this makes complete economic sense to an investor/savvy saver, the mge lender may not be as agreeable to your plan, as the extension of a short term extension past NRA, is generally where the mortgagor has no means to repay or their repayment vehicle has failed to meet target (with the extension intended under TCF, to afford the individual some time to organise themselves and final redemption) - it isn't really designed to perrmit the individual to merely retain funds for their own financial gain whilst investment returns continue to exceed their interest charges. (after all we must remember that they are running a business and if they can retrieve low funding debt to redistribute at a higher rate, then thats their aim).

With this post you may now put me with those you feel have been obstructive or judgemental, but please accept this in the spirit its meant, as an independent and hopefully helpful overview of how the lender will review the situ.

But going back to the top of the post, you'll only really know their view by presenting your proposals and hoping for the best.

Hope this helps .. wish you well

Holly x

paulo100

Holly Hobby
I am sure you realise that you are one of the 'good guys' who I thanked for help and advice, and I do so again for your last post.
I have been in business at very senior levels for over 30 years, and I can take a no nonsense approach from anyone (and give it out in equal or greater measure) without letting emotions intervene. However, when my simple request for information (that's all it was) is met with responses such as 'why should NW fund your lifestyle' and 'get ready to move' one has to consider whether these contributors ever wanted to help at all, or were they merely point scorers making (erroneous) assumptions based on their own twisted view of the things.
I don't expect NW to fund my life style, I do that very well myself. But NW have got themselves in a pickle where I, and a relatively small number of other borrowers are concerned, are paying out small change each month for a £160K plus mortgage, an arrangement that they are stuck with for 3 years and more, and have been for the last 3/4 years. Perhaps that is what has irritated some contributors

opinions4u

paulo100 wrote: »

Is it me?, quite possibly so...

Well stuff you then.

I have asked a very straight forward question of this forum (does anyone know if NW allow an extension to an interest only mortgage that runs its course in 3.6 years time)? Simple, simple question, no??

You've had your answer. Roughly translated "it depends". Simple as that.

The debate had moved on. There was talk of you keeping your existing rate. So I commented on that. My view is that you won't. And you give a sarcastic "forget it" comment.

Well excuse me for trying to prepare you for 2016. I know you've had two decades to think about it and haven't quite got round to sorting it out yet, but I don't think your response was warranted.

I haven't judged your circumstances, I've offered an educated opinion on rate if you are given an extension. Which is by no means guaranteed.

With the exception of 3 or 4 board members, who have been exceptionally helpful with their advice and outlining of their own experiences, (thanks again, you know who you are) I have been accused by others of trying to con the NW into 'funding my lifestyle', I have been told to, quote ‘get ready to move, if you think NW are going to wait until you die,(for their money)think again’

But I didn't make that comment. Yet got the response I've got.

and various other slightly aggressive responses where the poster clearly had no intention of trying to be helpful but merely wanted to show how smart they are with their snide responses.

Wasn't me though was it.

You are where you are. Talk to the lender. Deal with it.

I don't expect NW to fund my life style, I do that very well myself. But NW have got themselves in a pickle where I, and a relatively small number of other borrowers are concerned, are paying out small change each month for a £160K plus mortgage, an arrangement that they are stuck with for 3 years and more, and have been for the last 3/4 years. Perhaps that is what has irritated some contributors

I'd politely suggest that the borrower with £160k of debt and no means of repaying it is in more of a pickle.

You may yet have to sell up.

bigadaj

OP - you've had the responses and they are consistently in coming up with maybe.

If you are on a low rate and want to extend then there are two issues, one is ability to pay and the other is retaining the rate. Logically the lender is going to want you off that rate as soon as reasonably possible, therefore retaining rate looks unlikely.

You mention issues with inheritance tax, this would suggest significant sums elsewhere, if these are indicated as possible means to repay an interest only mortgage then that means there are funds available.

No lender has an absolute requirement to fund borrowing, if they choose to do so then they will also decide a rate.

paulo100

Malcnascar, I didn't disregard your solution, I agree that having read the responses, which generally confirm that it depends, and that there are no yes or no answers, I need to talk it through with NW on an individual basis and then act accordingly, based on the results of those discussions.
Opinions4U, not sure why you are so upset ('stuff you then', that's not very welcoming is it)? I wasn't attributing all of those comments to you, clearly not, as it wasn't you who made them. Calm down dear!

paulo100

bigadaj wrote: »

OP - you've had the responses and they are consistently in coming up with maybe. No lender has an absolute requirement to fund borrowing, if they choose to do so then they will also decide a rate.

bigadaj. Absolutely right, 'maybe' is the general feeling, and I will deal with it when the time is right by talking it through with them. Certainly no lender has an absolute requirement to lend, and I suspect that what will happen is that they will offer an extension of 5 years at the then current variable rate, once they see that I can easily meet the repayments. My decision will then have to be based on the cost/benefit factor of paying off the loan, or paying what will be significantly more than I am paying now.

paulo100

Interesting, thanks for the link.
Especially interesting that some lenders will still offer IO mortgages providing the LTV rate is no more than 50%. My LTV is around 15% so that's an definite option to consider.

holly_hobby

Hi Paulo,

Thanks, I did think I'd been (or tried to be) helpful, but I also want to be balanced and realistic for you too.

IO at a prescribed LTV, is still available with some lenders, unfortunately NWide (along with several other lenders), are no longer one of them (for new borrowings at least), where this remains an acceptable repayment method.

You do say you have sufficient capital invested, so (depending upon the medium its invested in) may well be an acceptable method generally, BUT the fact that you are requesting an amendment to the original contractual agreement in the form of a term extension (which incidentially also takes you past NRA of 65), purely as an exercise to retain the capital invested, because current returns are exceeding your present mge payrate (based of course on the assumption that the extended term, would also continue on the same interest basis), certainly doesn't come under TCF issues, and may well be considered by NW as an unjusitified reason for they to base or agree to any term extension (low rate retained or not).

However, as is apparent, only NW will be able to give you the definitive answer reqd ..... to which I of course wish you well (and if nothing else, you have some idea from this and prev posts, of the tack they may take in any rejection of the request wholly or retention of payrate you currently enjoy).

Hope this helps

Holly x