interest only mortgage

SAHD_Jim

edlucher66 wrote: »

Thank you Holly but feel about 80 years old at the minute , cant sleep worrying about this situation. My hubby really dosnt want to move he loves this house from the minute we found it, as I mentioned we were much better off when we moved here but then he was made redundant. I can only work 3 nights at the minute as my kids are young and I dont want to be a mum thats never around. He is very reluctant to share his business with anyone if he knew I was on here talking about this he would go mad!! I would love some financial advice. Many thanks so those who have posted replies but I think this is a no win situation.

It sounds to me like you are hoping for a magic wand or a silver bullet. Unfortunately that isn't going to happen, but you have already been given some sound financial advice on this thread. Sorry to sound harsh, but sometimes you just just have to look at things in the cold light of day.

Basically, from what you've said, your options are pretty straight forward:

a) Sell up and either move into a rental or purchase a downsized property with a C&I mortgage that you can afford/will qualify for.
or
b) Stay in the house with the IO mortgage and squirrel away every penny you can every month into ISA / NS&I until you are in a position to use the savings as a deposit and qualify for an affordable C&I mortgage or save up the £250K to pay the mortgage off. (Switching to C&I asap would be my choice)

Bear in mind that for option (b) to be feasible, you will have to be putting away many hundreds every month. Assuming you want the capital to remain safe in a low risk environment, as an example, £500 a month for 20 years at 2.5% gets you £155K. It is also important to maximise available interest rates and that means regular switching etc and to maintain tax free accounts where at all possible.

If your option is (b) then you need to look for every bit of advice you can find on this site. As has already been said, cut everything unnecessary out of your monthly budget and keep a close eye on everything you spend. You need to know exactly how much you can save so you can be sure it is even possible.

If your husband is desperate to keep the house, then you need to make him fully aware that this has to be a joint effort too or it is futile.

Some people on this site achieve incredible things (see the MFW forum for one). However it takes hard work, focus and real effort.

Good luck either way.

edlucher66

Sorry what is C&I mortgage?

holly_hobby

edlucher66 wrote: »

Sorry what is C&I mortgage?

Capital and interest (aka a Repayment Mortgage) .

H

cootuk

If you're 42 then that's still 25 years until you get a state pension so certainly a mortagable term.
You really need to start some sort of savings/investment to look towards paying off the capital, however that's realistically going to be several hundred per month.
Inflation isn't helping you either as the capital isn't being eroded by high wage inflation.
I guess there's the possibility of lump sums from inheritances that could potentially be factored in if they exist, but they can't be relied on.

edlucher66

If I had several hundred extra per month to save I would try to get a repayment mortgage but as it stands hubby has about 8k outstanding on credit cards. Maybe seeing a financial advisor or the like would help?

holly_hobby

If its to establish what would be affordable on a repayment mge, thats a good idea - not sure what alternative guidance they could provide though, to that already voiced within your thread.

Check you're happy with their fee before you engage them, and don't forget to let us know how you get on.

Hope this helps

Holly

edlucher66

Was thinking maybe Independent Mortgage Bureau would offer advice?

kent_money_saver

A good start would be to see an independant financial advisor, and a trip to the citizens advice bureau.
With 8k outstanding on credit cards , you both need to wake up and smell the coffee.
Its going to have to be a team effort to dig yourself out of this hole.

edlucher66

Ok I am now going to have a little cry...

holly_hobby

edlucher66 wrote: »

Ok I am now going to have a little cry...

Yep ... and then you and Hubby are straight down to business sorting it out !

Lots of help and support here for you if and when needed .... so don't feel you're adrift .. !!

Hope this helps

H x