Interest Only Mortgages

TotallyBroke

I have an Open Plan Mortgage with Woolwich\Barclays. It meant I had a mortgage and an amount that was classed as a loan. I came into difficulty and due to being on maternity I changed my mortgage to interest only. I now want to know what is the best thing to do. I had mortgage arrears and have a justified ccj against me. Although now because I'm getting myself on track Credit expert are showing my credit rating as good!!!!
I would like to know can I continue on interest only and pay extra to come off the capitol or will that not work. Should I consider a repayment mortgage or fixed rate mortgage. Will a different lender even touch me with my history or am I stuck with Woolwich\Barclays

MortgagesInc

I'm not really sure what Woolwich's stance is if you have mortgage arrears - are these cleared now? If so, you should be able to switch on to one of their 'retention' products, which will keep you on High Street rates. If you don't want to commit to a higher payment, then most Woolwich products have a 10% overpayment facility, so you could stay on interest only but repay lump sums to keep you on track - you need to make sure you do keep these up though so you don't fall behind on your target repayment date

TotallyBroke

Yes everything cleared up now. I'm also going to hit them for the £40 each month that they charged me for non payment as the arrears were small only a few payments but with the charges on top over a few years took it to a lot of money. I'm praying I can get them back or atleast some of it. It's not like they even sent me a letter costing £40 they just hit the account each month with the charge.

sarkin

If you check your KFI or T&C it should say if you can overpay on the product, i think it is normally 10% but do check. If you can over pay then this gives the flexibility of having both interest only and repayment IYSWIM.

What rate are you on at the moment?

TotallyBroke

I'm sorry I don't understand what a KFI or T&C is. I think my interest rate has now gone upto 5.9% but I'm not 100% sure. I can check over the weekend. I've never understood any of these things. I think we should teach children about interest rates etc in schools from a very early age.

Perspective

KFI - Key Facts Illustration, T&C - Terms and Conditions, if its 5.9% its not bad as long as you can ovepay. Simon

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