Post Office Remortgage and Changed Circumstances

siwatkins

Hi,

Current mortgage circa 200k (120k repayment, 80k interest only)
Current House value circa 260k
Age 50.

Looking to remortgage (3yr fix with Post Office/BOI is just up).

Circumstances about to change (leaving the Forces). Income reducing to £38k joint (wife's plus my Forces pension) from 1 Feb as starting my own business (I'm ignoring any income I'll have from that, as I'll have no books and may not earn any profit in year 1)

New mortgage requirement is 150k repayment only, as paying off £50k lump sum. No CC debts/Overdraft. 1 car repayment of 337/mo.

Looking for a 5yr fix. Looking at the Post Office again, as they have a pretty good 5yr fix rate. I'm imagining I'll be reassessed under MMR, but their calculator indicates they'll lend up to 159k, so should be ok?.

Before I talk to them, I just wanted to see if there were any pitfalls ahead. Essentially my concern is they won't let me remortgage on my new level of income (it was over double previously), which means I'd be locked into my current monthly repayment level and SVR of 3.99% which wouldn't be as affordable on new level of income. In which case I'll have to get a real job! I have one more paycheck to come from the Forces if that makes any difference.

Grateful for any pointers!

S

kingstreet

This is a customer retention product from your existing lender, not a remortgage.

Most lenders offer customer retention products without further status or affordability checks.

You need to establish your lender's policy. If anyone has done something similar recently, you may get lucky.

siwatkins

Thanks - will call tomorrow and see what they say

Thrugelmir

siwatkins wrote: »

which means I'd be locked into my current monthly repayment level and SVR of 3.99% which wouldn't be as affordable on new level of income.

Personal observation. Perhaps consider some part time work while you establish your new business. Use the money to overpay the mortgage. If finances are tight now.......

siwatkins

Thrugelmir wrote: »

Personal observation. Perhaps consider some part time work while you establish your new business. Use the money to overpay the mortgage. If finances are tight now.......

Fair point - finances would only be tight, not taut, if I didn't remortgage. I'm just wishing to ensure we have solid finances should, say, my wife lose her job. My pension is secure and enough to pay the bills.