extending mortgage term

house18

we have 15 yrs remaining on our current mortgage. My husband was made redundant 18 months ago and has been trying to set himself up as self employed for the last 12months.
We have informed the bank that we will continue to struggle to meet our current monthly repayments due to our significantly reduced income and have requested on numerous occasions that we extend the term of the mortgage ( not to borrow more - only to reduce our monthly repayments which I will be able to afford on my income alone). On each occasion they have refused, stating that we have failed the affordability criteria.
I would assume that the bank has a responsibility to enter into communications with us to reach a payment plan that protects our home and reduces the risk of repossession.
We have been open and honest with the bank at every stage, but have now run out of options.
I would be grateful for any advice on what we should do next.........

lonestarfan

What is the house worth and how much do you owe.
What are Your ages
What's your income
Have you been keeping up with payments or are you in arrears.
Who is the lender

house18

The house is worth 150000 - we owe 105000. we are both 44 yrs old. I earn 34000 pa. My husband cannot provide 3 yrs self employed evidence of income.
we did have 3 months arrears beginning of year but this was due to an error on the banks part - we had mortgage protection insurance which refused to pay out for the required time amount. They eventually acknowledged their error, paid us back what was owed and we cleared the arrears - the bank assured us that any 'bad' credit would be cleared due to their error ( I have checked this and it does not appear on those credit check things).
Lender is natwest

Thrugelmir

house18 wrote: »

I would assume that the bank has a responsibility to enter into communications with us to reach a payment plan that protects our home and reduces the risk of repossession.

A responsibility yes, but with the proviso that the lending is both responsible and affordable. So any decision will be based on your overall financial circumstances. Your mortgage lender is not obliged to shoulder the risk to the benefit of other creditors. Affordability will be assessed in accordance with the current guidelines issued by the FCA.

This does not absolve you of your own responsibilities to take the appropriate action. Life is full of difficult personal decisions.

lonestarfan

Is it interest in,y or repayment?
It sounds do able so it must be your outgoings.
What loans and credit cards do you have as I've seen in these boards that credit card/loans drastically, pulls down what they'll lend.
So sometimes it seems that if that is removed then that helps.
Your age seems ok as your retiremt age is 67.
I think you should get a broker to see if you could remortage or at t.eata to give you advice where you're affordability issues are.
I believe you are keeping up payments so remortgaging isn't out of the question.
You should get your credit files from the 3 agencies. You might be able to get them free on topcashback. Noddle is definitely free.

kingstreet

This is the kind of ridiculous situation the FCA needs to deal with.

The OP is experiencing difficulty and under;-

the transitional arrangements published in October 2012
accepted forbearance practice
basic TCF

the lender should be helping the OP and people like them.

If they can't afford it over the longer term, how can they afford it over the current shorter one? It's totally counter-intuitive.

The mortgage is already there, already a fact of life. It isn't a new lending decision so the lender should get an attack of reality and stop the daft rulebook lending some have adopted in the wake of the MMR.

The latest in a list of similar articles;-

http://www.mortgagesolutions.co.uk/mortgage-solutions/news/2380256/fca-mystery-shops-firms-to-stamp-out-rule-book-lending?utm_term=&utm_content=FCA%20mystery%20shops%20firms%20to%20stamp%20out%20rule%20book%20lending&utm_campaign=MS.SP_06.Daily_RL.EU.A.U&utm_medium=Email&utm_source=MS.DCM.Editors_Updates

I think the OP should consider a formal complaint to the lender and consider the FOS if no reasonable conclusion is forthcoming.

house18

Thank you - this is really useful.
At my insistence i have today been referred to a different team and will be given a decision within 7 days.
If their response is not satisfactory i will certainly be asking about their complaints procedure, and will consider the FOS.
The links will prove useful for me to know my rights.

Thrugelmir

kingstreet wrote: »

This is the kind of ridiculous situation the FCA needs to deal with.

Can only be dealt with on a case by case basis with the full facts to hand.

Thrugelmir

house18 wrote: »

If their response is not satisfactory i will certainly be asking about their complaints procedure, and will consider the FOS.
The links will prove useful for me to know my rights.

You'll need justifiable grounds for complaint. Simply not acceding to your demands won't get you anywhere.

amnblog

The Lenders appear to be ignoring provisions under transitional arrangements. The FCA should instruct lenders to use these provisions.

kingstreet

Thrugelmir wrote: »

Can only be dealt with on a case by case basis with the full facts to hand.

Exactly. They are looking at each case, then applying pre-sale affordability checks they shouldn't for the reasons given, then saying no, you can't afford it.

They then continue to charge them higher payments than what they couldn't afford on the calculator.

It is completely perverse.