Interest only mortgage - advice needed

tivacat

Hi - I am a single homeowner. I have always had an interest only mortgage currently 90k - my financial advisor, because I have no dependents, has always said "die with debt" . I have 40k equity. I also have three buy to let properties - between them they have 90k equity at current property prices.

I was on a Halifax fixed rate for my residential mortgage of 90k which has recently ended - at a recent meeting with Halifax to move to another fixed deal they told me they can't offer me another mortgage as my savings/investments (approx 25k) do not cover the value of the mortgage. They will not take into account the equity in my properties.

At the moment they are leaving me on a variable rate - but I'm worried about what might happen. To move to a repayment mortgage will cost another £500 a month which is not feasible.

Has anybody else come across this problem due to the tightening up of the interest only mortgage market. What other options are out there - other than sell off some properties to reduce down my interest only mortgage? My financial advisor has gone a bit quiet on me so any help / suggestions appreciated.

Mortgage_Mark_2

Interest only is more or less a thing of the past with regards residential mortgages.

The kind of provisions you need in place to satisfy them that you will be able to repay the mortgage are essentially equivalent to cash in the bank, so why would you take a mortgage?

Your adviser's recommendation of 'die with debt' is interesting though!

mrginge

Why should a commercial financial institution have to fund your desire to leave a load of debt when you die?

tivacat

Mr Gringe - you misunderstand - there will be no debt when I die as there is enough equity across my properties to pay off the mortgages

Thrugelmir

Looking ahead. Where do you intend living when you retire. At the very least owning your residential property outright is a must. Something that you should plan for now. Running BTL's may not be so attractive in later life.