Interest Only Mortgage coming to an end

jacquie3167

Hi, I'm hoping someone can help. My partner took over his mother's mortgage a few years ago when he moved back into the family home. He has now found out that it is an Interest Only Mortgage for a period of 16 years and there is 7 years left before the value of over £200,000 is due to be paid. He is in a state of shock and just needs some advice on what his options are. He is 53 years of age so some options are not applicable. Will he need to sell up? Can he resolve this somehow?

Thanks in advance.

ACG

He/his mother or both could overpay on the mortgage.
Quick calculations show he would need to overpay by around £2k a month which I am guessing is not an option?

His mother could do an equity release mortgage - although it would depend on the equity in the house.

What is the long term plan? In 16 years, his mother could pass away? I am guessing in 16 years she will be pushing 90. She may go in to a care home. Both of which would mean the mortgage would need redeeming and probably the house being sold.

thriftylass

Probably best to speak to the mortgage provider? Was the mortgage taken out before April 2014 (not sure if just a takeover counts).

https://www.moneyadviceservice.org.uk/en/articles/ways-of-repaying-an-interest-only-mortgage#re-mortgaging

getmore4less

Sounds like he just started paying the mortgage and did not take it over.

That is a significant difference please clarify.

options
Start paying off capital,
Make sure it is on a good rate.

Is the mother still there, how old is she?

what's the house worth

foxy-stoat

jacquie3167 wrote: »

Hi, I'm hoping someone lcan help. My partner took over his mother's mortgage a few years ago when he moved back into the family home. He has now found out that it is an Interest Only Mortgage for a period of 16 years and there is 7 years left before the value of over £200,000 is due to be paid. He is in a state of shock and just needs some advice on what his options are. He is 53 years of age so some options are not applicable. Will he need to sell up? Can he resolve this somehow?

Thanks in advance.

Did he not find out about the mortgage when he took over it? He must of had to sign something ( had read something ).

AnotherJoe

I'm presuming as per post 4, by "take over" OP simply means "started paying his mothers mortgage"

davidmcn

AnotherJoe wrote: »

I'm presuming as per post 4, by "take over" OP simply means "started paying his mothers mortgage"

Possibly, though that would suggest mum still owns the house (and lives there?) so the question "will he need to sell up" doesn't make sense.

foxy-stoat

Hows name is the mortgage under - the mother or the mother and son? Is it Joint Tenants or Tenants in Common?

Best thing to do is Transfer of Equity with Tenants in Common equal shares and new repayment mortgage - but need more information about ages and salaries.

AnotherJoe

davidmcn wrote: »

Possibly, though that would suggest mum still owns the house (and lives there?) so the question "will he need to sell up" doesn't make sense.

True but then the post doesn't make sense if its his mortgage either !

silvercar

Whoever owns the property, the son is the one that is paying the mortgage. It ends in 7 years and there is no repayment plan in place. The options are:

1. sell up and find somewhere else to live eg rent or buy somewhere smaller
2. take a new mortgage, either equity release if in mother's name or a repayment mortgage in son's name

tacpot12

What was his mother's plan as to how she was going to repay the mortgage at the end of the term?