Barclays won't give me a mortgage holiday - help needed

kirsteenatom

Hi
I changed jobs last year and decided to rent out my house and rent a house closer to my new work.

The intention was to rent for a year and then sell my house and buy in the new area once I knew more about the area and where the kids would be going to school.

I've had a nightmare time with my tenant - not paying rent, or late, causing disturbances with the neighbours, abusing me by text and email. I finally managed to arrange an agreement to mutually dissolve the tenancy and she moved out last Friday.

I now have an empty house with no rent coming in, but both mortgage and rent to pay, totalling £2000 a month. I've put the house on the market immediately and am looking for a place to buy. My current tenancy is up in early July so I am hoping that it will all dovetail nicely. The problem is I can't afford to pay both rent and mortgage without any rent coming in.

I contacted Barclays to ask about a mortgage holiday and they simply said they didn't do them. I asked what would happen if I couldn't pay my mortgage for a couple of months and they said it would affect my credit rating.

I have no debts at all apart from my mortgage. I pay my credit card off every month, and hardly use it and I really don't want to hve my credit rating affected simply because of the situation I find myself in.

Is there any point in trying to speak to someone further up the tree and asking for individual consideration? I'm willing to port my mortgage and stay with them rather than going to another lender when I sell and buy a new house - surely that should help?

Any advice on what I can do to stop myself losing money and going overdrawn until I sell the house would be much appreciated.

Kirsteen

tomtontom

Did you have consent to let?

silvercar

I have no debts at all apart from my mortgage. I pay my credit card off every month, and hardly use it and I really don't want to hve my credit rating affected simply because of the situation I find myself in.

Then pay your mortgage rather than your credit card. You could even take a cash advance on your credit card to pay the mortgage - high interest but it would keep your credit rating intact.

kirsteenatom

tomtontom wrote: »

Did you have consent to let?

Yes.I did it all properly with them, so they know I asked for consent to let last June/July and I'm not a full year into the let.

kirsteenatom

silvercar wrote: »

Then pay your mortgage rather than your credit card. You could even take a cash advance on your credit card to pay the mortgage - high interest but it would keep your credit rating intact.

I'm not sure what you mean. I don't use my credit card. I have nothing owing anywhere except the mortgage.
The mortgage is £695 per month. My rent is £1050 per month. That totals £1750 per month. I'm a single parent and although I have a decent job that is beyond my income. I don't want to go overdrawn at the bank so a mortgage holiday seemed like an option that would just get me over this little period until I've sold the house and have one household again.

Keekles

kirsteenatom wrote: »

I'm not sure what you mean. I don't use my credit card. I have nothing owing anywhere except the mortgage.
I don't want to go overdrawn at the bank so a mortgage holiday seemed like an option that would just get me over this little period until I've sold the house and have one household again.

It's not ideal but I think what silvercar means is, your mortgage payment is an absolute priority and if there's no way of avoiding the debt completely (i.e. finding £2-4k in £50 notes on the floor), you're better off taking an agreed overdraft or using your credit card to make the payment, as opposed to missing a payment which is more damaging in the long term - especially when you might be considering a new mortgage application.

kirsteenatom

I really would rather avoid racking up a debt anywhere as i would struggle to pay it back.

If a mortgage company says they don't do mortgage holidays is there no point in trying to negotiate with them then? is it just yes/no in most cases?

thanks

k3lvc

kirsteenatom wrote: »

I really would rather avoid racking up a debt anywhere as i would struggle to pay it back.

If a mortgage company says they don't do mortgage holidays is there no point in trying to negotiate with them then? is it just yes/no in most cases?

thanks

But a mortgage holiday is still 'racking up debt' - you're just paying it back over a longer period

nidO

kirsteenatom wrote: »

I really would rather avoid racking up a debt anywhere as i would struggle to pay it back.

The only "extra" thing you'll be having to pay back is interest.
Say you take a payment holiday, all that's doing is effectively adding the value of your monthly payments to your mortgage (by it not being paid down) plus mortgage interest, which will be paid off when you sell the house.
The alternative as suggested is to take your mortgage payment amounts as an overdraft, cash advance on your credit card, etc and pay the mortgage with that, meaning your mortgage will be lower by that amount when you come to sell the house, and that difference can be used to pay off the card/bank, minus interest.

The principal is the same (your monthly mortgage payments), the only difference is the amount of interest your overdraft/card charge you above the interest your mortgage charges you.

There is therefore no "racking up a debt" or not as you're going to do so anyway and pay it off in the same way by selling the house, the difference is just whether it's:

1) low interest by taking a payment holiday (which it seems you can't do)
2) low interest but trashing your credit record by missing payments (bad for the future)
3) higher interest by borrowing your mortgage payments from an overdraft or credit card, which is both easy and won't negatively impact your ability to get credit in future.

Keekles

kirsteenatom wrote: »

I really would rather avoid racking up a debt anywhere as i would struggle to pay it back.

If a mortgage company says they don't do mortgage holidays is there no point in trying to negotiate with them then? is it just yes/no in most cases?

thanks

As K3lvc says; debt is debt. Whether it be a missed mortgage payment, an overdraft or a credit card debt - you'll be owing an amount to a lender, somewhere.

Rather a debt to a credit card / my bank in which it's an agreed debt as opposed to missing a payment and generating a debt against an agreement in which the lender won't permit it.

Atomix

rent out my house and rent a house closer to my new work

How far is your new job from your old house? Maybe move back and commute / paying just your mortgage...?