Changing Mortgage While House Is For Sale

ms_fashionista

My mother has her house on the market. She has a repayment mortgage with Halifax with no tie-ins for approx 6-7 years. Would she be able to change it to interest only option (she is 56yrs old & has excellent credit rating). The house is valued at £365-£375k & mortgage is approx £60k?

She is concerned that she would not be able to get a mortgage due to her age.

Any advice is greatly appreciated.

KrisBolton

Hi ms fashionista

Yes your mother can get a mortgage and can change it while it is up for sale. Her age shouldn't be an issue if the term is kept to 6-7 years and her income can support the loan. The vast majority of lenders will allow a mortgage to run to 65 years old, and many beyond that nowadays.

Find a whole of market adviser in your area and they will help her to sort it out and provide all the options available

Badger_Lady

I changed my mortgage to interest-only while my property was for sale, because I would struggle to keep up with mortgage repayments whilst renting elsewhere.

My existing mortgage provider simply switched it over (for an admin fee of £50!) - there was no further credit checking etc needed.

ms_fashionista

Thanks Badger_Lady I will let her know.

MarkyMarkD

IMHO there is no point switching products (or remortgaging) whilst your property is on sale.

Whilst it may be possible to port the new mortgage to a new lender, that's not 100% certain due to changes in the lender's underwriting criteria of the borrower's circumstances.

For a few months' interest saving I would argue it's not worth the effort of switching.

riad_2

I would only advise it only if you are able to do it with the existing lender.

By re-mortgaging to another lender, you're unlikely to benefit with all the legal fees and all you'll be paying...

MarkyMarkD

But even switching products with the existing lender, you are likely to end up with a new tie-in period and hence bound to seek a new mortgage with that same lender once you move.

And if they won't, at that point, lend you the money you need because they don't like your new house, or your new job, or your new lack of job, you will be unable to avoid paying an ERC which could be significant.

So maybe I should rephrase my advice - don't remortgage, or switch products, in these circumstances EXCEPT to a product with no ERC.

alm721

Im in the same situation and am about to remortgage with the same lender who have assured me that I can port the mortgage to a new house. Was wondering about switching to interest only for a while but thought you'd have to have something like an endowment in place, can you do it without?
Thanks

Dan_Collins_2

Halifax will offer a deal and change to interest only. Just make sure that if she does not need a mortgage to stick with what she has rate wise, as from what I remember Halifax do not have a transfer deal with no ties but it is worth the call!