Interest-only Mortgage extended for 1 Year

Inness_Law

Hello,

Like a lot of people I think this couple of years, my 25 year Interest-only mortgage was recently due for completion. The amount left on the mortgage is roughly £40,000. Unfortunately, I do not have a sufficient enough repayment vehicle to repay the £40k capital. My bank has extended my mortgage for 1 year and in this time, I am expected to remain paying my monthly payments and at the end of this 1 year extension, expected to pay the £40k.

So my question is, what options are available to me? Is re-mortgaging a good option?

Any advice/experience/help would be gratefully appreciated.

Many thanks,
Inness

TadleyBaggie

I think the most pertinent question is, what are you actively doing to ensure that a repayment vehicle will be in place at the appropriate time?

In my case I used part of the 25% tax free lump sum from an old private pension to pay off the remaining mortgage.

AnotherJoe

Inness_Law wrote: »

So my question is, what options are available to me? Is re-mortgaging a good option?

That would depend upon your age, salary, the amount outstanding after the insufficient repayment vehicle has been used, other savings, what might be available from your pension if you are over 55, your other debts and loans and your spending and ability to reduce that if needed.
Also the current value of the house determines what downsizing options you have.

Thrugelmir

Inness_Law wrote: »

I am expected to remain paying my monthly payments and at the end of this 1 year extension, expected to pay the £40k.

If you cannot raise the money then prepare to sell the property.