Allowable Mortgage Expenses

Debt_Mountain

Hey all,

I have organised an informal plan with my creditors to pay back my debts over time, and got them down from around 80k in 2009 to around 28000 today.

I have a change in circumstances, and I was wondering if I could include some kind of deduction in my SOA for payments to an ISA to start offsetting against my interest only mortgage. To date I haven't put any of this aside. The alternative could of course be to move to a repayment mortgage.

Would creditors allow this, or reject?

harrys_dad

I cannot answer your question, but well done for getting down from 80K to 28K in four years.

It is never a good idea to have an interest only mortgage with no plan to pay it off. I doubt however that you will find an ISA that will pay more interest than your mortgage interest, so why not just overpay the mortgage (if creditors will wear that).

If not, a repayment mortgage might be the way to go, but will you be able to get a different mortgage with 28K debts?

Debt_Mountain

I still don't know if I can include some kind of allowance in my affordability budget back to creditors for a mortgage capital repayment on top of the interest only mortgage.

Anybody seen this before?

I don't think I will be able to change to repayment only mortgage given mt existing credit history.

simeyb

Unfortunately I think most, if not all, creditors will not be keen to see you go onto a repayment mortgage, or to have any savings, all the time you have an arrangement with them. Having said that, I have started to move parts of my interest only mortgage over to repayment (I'm with the Chelsea and they will allow me to move chunks at a time fee free) and I don't plan on telling my DMP creditors - I have paid a serious chunk of money back to and aim to be debt free this time next year. My view now is !!!! 'em. I have gone without completely over the last 6 years and while I know it was my fault I got in debt, they have so far had over 80% repaid (minus interest which I haven't been paying) - so !!!!!! them. Suggest you just continuing paying your creditors and do what you have to with your mortgage and depending on your "bottle level", don't tell them.