Barclays/Woolwich remortgage

mishkanorman

We are about to have a meeting with a Barclays mortgage adviser and wanted to check a couple of things I have been told in advance,

Currently we are on an interest only mortgage tracking at .50 % above base rate, we wish to extend the term to 20 years (8yrs remaining) and increase the amount from 45k to 85k, he advised that we would need to flip the whole amount to repayment, they dont offer extensions anymore at a different rate and they dont allow interest only mortgages, when we took the mortgage out however it was with The Woolwich and was called Openplan which had a preapproved reserve which we could access if we wished, I want to check im not about to be told what suits them rather than what will suit us,
any advice or info i should know ?

getmore4less

Reserves are getting reviewed down.

If you use the current reserve it will be at svr unless you are offset.

What were your plans to pay the mortgage off?

They can put any conditions they like on more borrowing and extending term.

Thrugelmir

mishkanorman wrote: »

I want to check im not about to be told what suits them rather than what will suit us,
any advice or info i should know ?

A lender holds the cards as it's there business. So your only choice is to accept what's on the table or leave the mortgage as it is.

From a commercial point of view why would they wish to extend the term for another 12 years. As will cost them money. When you originally took the mortgage out base rate was considerably higher than it has been for some years now.

With regards to interest only mortgages. Lenders now require a repayment vehicle. Given that few vehicles offer a guaranteed repayment of the debt. A repayment mortgage is the required option.Over 96% of new lending is now repayment mortgages. As interest only suits relatively few peoples circumstances.

amnblog

If you go direct to Barclays they will tell you what they want you to hear.

An independent broker will tell you what is possible for you.

mishkanorman

I meant more than this specific rep doesnt tell me what suits his bonus from the products they offer rather than what will be a better choice from our point of view, we've been stung in the past.

I had wanted to see options for the additional borrowing (45k) being repayment and the current loan (40k) being interest only, we have a few options for repaying the interest part of our loan that are failing badly so wont reach the full amount in the time we have. When we purchased the current house (10 years ago) we added a small amount to the mortgage, extend by 5 years and flipped some of the amount over to repayment so had wanted to check if that could still be done.

mishkanorman

Quick update in case this helps anyone else,

Mortgage advisor was actually really helpful in the end, I had a brief chat with Barclays online a couple of days before we went and they advised our only option was to take out a homeowners loan which came in at a wacking £650+ extra a month ! So I wasnt expecting great things.
We actually ended up keeping our current loan amount and rate (I think its actually .75% above base rate) and extending the term on that to 25 years, borrowing the additional amount we wanted on a 2 year fix of 1.85% and paying no fees for any of it. It means our outgoings at the minute only go up by £100 - really pleased with that !