Extending an Interest Only Mortgage ?

I'm 59 years old, I have an interest only mortgage of c £188k due for repayment December 2020 and zero capital to pay it off. The house is worth c.£330k and plan has always been to sell, pay off mortgage and move to rental but ...... now the time approaches, I want to check out other options first.

Would there be lenders prepared to remortgage on an interest only basis, given that the LTV would only be just over 50% ?

I'm not concerned about paying off the mortgage other than via future house sale either at chosen time or end of life.

Thoughts ?

Replies

  • JMA74JMA74 Forumite
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    There may be lenders who will allow this at 50% ltv. Not impossible. They will all have an end date so at some point in the future (when your health may not be as good or you may be more vulnerable) you will have to sell and figure out what to do.

    If you are happy to sell and pay rent for the rest of your life, have you considered Equity Release? The numbers may be a push to get enough to clear it but maybe you can get enough to sell yours and purchase a new home you can stay in until you die in (hopefully) decades time.
    I am a Mortgage Adviser

    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.

    please do not contact to request representation
  • Thanks for replying. The equity release option doesn't appear - from initial enquiries (I'm no expert) - to free up much as I'm not old enough so I'd be better off simply taking the profit from the house sale. However, at the moment I'm trying to understand and exhaust all/any options that allow me to stay put at least for the immediate future.
  • JMA74JMA74 Forumite
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    Yeah I was more thinking about a downsize option. Where you take your equity of £140k and then use equity release for a purchase maybe getting £80k or £90k extra to buy for around £220k. Just an idea


    As far as interest only is concerned. I have done one for residential borrowing with downsizing as the repayment vehicle that started at age 71 and was a 20 yaer mortgage.
    Not many lenders are operating in this kind of example but there are options out there as long as you have a reasonable and plausible repayment plan.
    I am a Mortgage Adviser

    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.

    please do not contact to request representation
  • If I wanted to talk this through with an adviser and understand options better, where do you recommend I look ? I'm not looking for a specific name just don't know where to start looking and obviously don't want a Financial adviser who has no real expertise in this area.
  • JMA74JMA74 Forumite
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    Sid_Cowans wrote: »
    If I wanted to talk this through with an adviser and understand options better, where do you recommend I look ? I'm not looking for a specific name just don't know where to start looking and obviously don't want a Financial adviser who has no real expertise in this area.

    The interest only aspect shouldn't be that tricky, just a case of spending time with your numbers and seeing how it all adds up. . Any half decent broker should be able to tell you what your options are.
    I always suggest starting with family/friends/coworkers recommendations. Or google and look for good reviews. Or stick a post in a local facebook community page asking for recommendations.
    In the initial meeting they should discuss fees and what lenders they use. The more lenders you haven't heard of the better for a case like this as small building societies tend to be better for cases that aren't 'normal'.
    I use around 50-60 main lenders but can go to pretty much any lender that pays me to place business so if someone says they use 20 lenders and cant use any more then you aren't going to get as good a look at the options.
    I am a Mortgage Adviser

    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.

    please do not contact to request representation
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