End of mortgage term question

rms1

Our mortgage is due to end in Oct 2016 when I will be 65. Although we will have a considerable amount of collateral in the property (around 55%), for various reasons (failed pension funds etc) there will be around 160k still owing. I am self employed in our small family business and have no intention of retiring and even if I do, the business will continue providing an income.


I have always kept up the mortgage payments and did make a sizeable payment 3 years ago and my credit rating is good.


I am now looking at my options, I have found companies that will lend to people through to late 70's but at this moment in time it is difficult for me to know where I will be financially in 2 years so I am wondering, if I do nothing for the time being, what will happen when the mortgage ends. Does anyone have any experience of this. Will the BS (Halifax) allow me time to either sell the house or lengthen the term or find another lender. I know every case is different but any answers would be appreciated.

rms1

Bump


Sorry but desperate for information

Thrugelmir

With over 2 years to run until the end of the mortgage term. You are unlikely to obtain any definative answer from the Halifax.

In the interim period I would suggest reducing the mortgage debt by as much as you able. As with £160k owing and interest rate rises on the horizon. The major question will be affordability in the future. While many people intend continuing to work. Not always possible as one gets older.

ACG

Any changes now will result in the mortgage having to go on repayment - is that still affordable?

If so then you may be able to switch lenders now to avoid any uncertainty. If not then its difficult to answer and will be dependent on halifax at the point whne you come to ask for changes.

rms1

Thrugelmir wrote: »

With over 2 years to run until the end of the mortgage term. You are unlikely to obtain any definative answer from the Halifax.

In the interim period I would suggest reducing the mortgage debt by as much as you able. As with £160k owing and interest rate rises on the horizon. The major question will be affordability in the future. While many people intend continuing to work. Not always possible as one gets older.

I appreciate what you are saying, fortunately, this is a business that we run from home providing enough for us to live reasonably well for not much effort in fact I wish we had done what we are doing now years ago. If we were unable to cope alone, it would not be difficult to get help.


We are making payments over and above the minimum but being realistic, this is not going to make huge inroads in 2 years.


I am mainly concerned about what stance the Halifax will take at the end of the term in other words, would it be "you have 3 months to get out" or more along the lines of "you can have an extra year to sell your property"


Has anyone been through a similar experience?

rms1

ACG wrote: »

Any changes now will result in the mortgage having to go on repayment - is that still affordable?

If so then you may be able to switch lenders now to avoid any uncertainty. If not then its difficult to answer and will be dependent on halifax at the point whne you come to ask for changes.

I would like to switch now but unfortunately I need a while longer to get another couple of sets of accounts in to prove affordability.

ACG

This is becoming quite tricky.

I would probably just make any overpayments you can do now, get your balance down, evidence that you have been making higher payments and if it is a borderline case with a lender where underwriters do have discretion then it could be the difference between being accepted or not.

A lot can change between now and 2 years though, everything is still a little up in the air following MMR and lenders may make changes in time.

rms1

ACG wrote: »

This is becoming quite tricky.

I would probably just make any overpayments you can do now, get your balance down, evidence that you have been making higher payments and if it is a borderline case with a lender where underwriters do have discretion then it could be the difference between being accepted or not.

A lot can change between now and 2 years though, everything is still a little up in the air following MMR and lenders may make changes in time.

I am tempted to take your advice. I am on interest only so I am thinking I should double my payments and try and knock 10k of the total over the next 2 years and as you say, this will prove affordability.

getmore4less

With £160k owing you need a serious think.

Even an extra 10 years to 75 would require over £1500 pm to pay it back

Doubling the payment on an interest only basis will not show afforability to pay off the debt in a reasonable time.

rms1

getmore4less wrote: »

With £160k owing you need a serious think.

Even an extra 10 years to 75 would require over £1500 pm to pay it back

Doubling the payment on an interest only basis will not show afforability to pay off the debt in a reasonable time.

I very much appreciate what you are saying however, we are highly likely to be down sizing and selling the property well before 10 years. I would just feel better if I knew that the decision when to sell was ours and not a forced one.

getmore4less

it has always been in your control --- your choice to run out of time.