Redundancy requires switch from repayment to interest only but Santander not playing ball

redundantandworried

Hi, 
This is the single biggest stress I have at the moment. Made redundant in August and have a repayment mortgage. Didn't get a good redundancy package so ideally need to switch from repayment to interest only for remaining term (15 months) which would save me circa £1300 a month. Santander refusing to do this and forcing me to go into arrears - what are my options when I CAN afford to pay an interest only mortgage?!?
Please help!

tacpot12

It does seem crazy that with less than £20K of capital owed they are not prepared to give you a payment holiday. 
You could complain to them, you could borrow the money on an unsecured loan if you have income to cover the loan repayments, you might borrow payments from one or more family members, or you could get a new job that pays enough to allow you restart the payments. You might also look at refinancing over a longer term, and then overpay when you get a job.  

ACG

When you say term is 15 months, do you mean you have 15 months remaining with santander or the whole mortgage? 

To be honest, with anything like this they tend to only take you seriously when you go into arrears. You will probably find them far more accommodating when you do go into arrears.  

If you only have 15 months remaining in total, how do you plan on clearing the balance in 15 months? Can you pay anything towards the balance? ie interest only, plus an additional £50-100 a month? Wait until you go into arrears, the arrears team will speak to you then and they have more flexibility. It wont just go to court and you lose your home, that would take months. I think the key thing is to show willing and pay what you can and have an idea of how you will clear the balance be it downsizing or pension pot or whatever, some reassurance that in 15 months you can actually clear the mortgage. 

redundantandworried

To be clear - there is 15 months left on the deal not on the total term of the mortage (I wish it were the end of it though!)
Is there any consumer law whereby I can force them down the interest only route to avoid going into arrears as I really don't want the impact on my credit rating. I cannot be the only person in this situation given what has happened over the last 6 months?

Thrugelmir

You should continue to make the full repayments as long as you are able. Once you cannot.  Santander will most likely allow you a 6 month payment holiday. After which you'll need to make some decisions if repayment cannot be resumed. 

Pay the mortgage ahead of other unsecured debts. 

Lots of people are going to be financial difficulty of all kinds. Redundancies aren't anything new. That's life. We are all just get on with it. 

MWT

Have you considered applying for a 3 month payment holiday?

That would give you the breathing room to pause and figure out what you need to do and how soon you might be able to get a new job.

As you are not already in default, the payment holiday should not impact on your credit file.

https://www.santander.co.uk/personal/support/loans-and-mortgages/coronavirus-faq

ACG

redundantandworried said:

To be clear - there is 15 months left on the deal not on the total term of the mortage (I wish it were the end of it though!)
Is there any consumer law whereby I can force them down the interest only route to avoid going into arrears as I really don't want the impact on my credit rating. I cannot be the only person in this situation given what has happened over the last 6 months?

The mortgage lender has to pay that money back to savers/money markets. You cant force them to do anything and even if they agreed to interest only repayments it usually still shows as arrears on your account. The only exception to that is if you are claiming the covid 19 payment holiday. 

Brock_and_Roll

What's the capital balance on the mortgage? i

dunstonh

Is there any consumer law whereby I can force them down the interest only route to avoid going into arrears as I really don't want the impact on my credit rating.

No. 

 I cannot be the only person in this situation given what has happened over the last 6 months?

You are not.  That is why the Covid mortgage holidays (authorised arrears) were brought in.   Mainly to help those with poor finances (i.e no savings) to get through it.   Did you apply for a mortgage holiday?