Success in swapping from repayment to interest only with Santander?

wayeye

We have a mortgage with Santander and are wondering if we can see ourselves through a short-term financial squeeze by swapping from repayment to interest only.

Just wondering if anyone had successfully/unsuccessfully done this recently.
Is there anything that would be helpful to know? Ie a 'financial squeeze' is not reason/valid enough?
I know they need you to have a repayment vehicle set-up elsewhere? We do want to swap back by the end of the year, but would they accept a plan to use house equity to clear the loan as sufficient security?
Sorry, lots of questions. Any advice warmly welcomed. TIA.

AnotherJoe

If you want to swap back by end of year, then you'd be best off asking if you can go to interest only repayments for the rest of this year rather than actually changing the mortgage twice with all the fees involved.
Alternatively could you remortgage to (say) a 20 year mortgage? That would drop the cost by around £600 a month.
Third solution, you seemingly are over reaching yourselves, why not sell up and buy a cheaper house.

wayeye

Didn't realise we could ask to do it as a short-term solution, thanks for that.

And not over-reaching, but thanks. Difficult personal circumstances that I don't wish to share, that's all.

Thrugelmir

wayeye wrote: »

Is there anything that would be helpful to know? Ie a 'financial squeeze' is not reason/valid enough?

Financial squeeze could mean any number of things. You'll lose nothing by talking to Santander in the first instance.

wayeye

Does anyone know if this would even be a reason Santander would consider? I'm worried it might freak them out and have the opposite effect!

AnotherJoe

wayeye wrote: »

My concern is I feel like I have one shot at this.
So here's the deal (sharing in the hope someone might know what baring this might have on an application to swap to interest only)...
My husband and I have separated (amicably). He's renting a flat while I stay in the house with the kids (age 5 & 2) but financially this is unsubstainable long-term. We're facing having to sell up to fund two properties for us, but for school admissions reasons we ideally need to stay put for another two years (then sell). The repayment to interest only switch would free up a whopping £2k a month which means I could stay in the house with the kids.

Does anyone know if this would even be a reason Santander would consider? I'm worried it might freak them out and have the opposite effect!

What would "the opposite effect" be? They arent going to evict you unless you stop paying the mortgage. Do you mean they wouldn't let you switch to IO if they knew you were separated? I doubt they would let you switch anyway as they'd want to see a repayment vehicle in place and frankly waiting for 2 years simply because you like a particular school is unlikely to be a convincing proposition. Maybe because you are finalizing the details of your divorce might be. But two years is a heck of a long time to be doing that! Talking of which, you initially said it was until end of this year. Now its for two years ???

You also said you weren't over-extending yourselves, but living in a £1.3m house with £900k equity whilst also renting a flat and having problems affording it all, is over-extending yourselves. The fact there are "extenuating circumstances" and you arent in a bigger house than you can afford out of mere vanity, does not mean you arent over-extending. You obviously are over-extended.

Why cant you sell and move within the same catchment area right now? Could you sell, buy a house in the school catchment area for cash, husband rents, then in 2 years sell the catchment house and move to long term houses for both of you?