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Drawback to switch from repayment to interest only on Residential property
geekhatri78
Posts: 4 Newbie
Hi Guys,
hope you will be able to provide the answer my question-
I am in process to do an extension my property, and as my both childrens have severe eczema conditions, builder is suggesting to move out when they start knocking down the internal walls.
which means I have to move out as a tenant, i did call to my mortgage lender to understand my position if I switch from repayment to interest only (for 2-3 months), they advised that it has to go through specialist team (which indirect mean financial difficulties team) and mentioned to me if I do so, it will go on my credit file but the advisor not advised what it will say in credit file as I will not miss the payments- it will just interest only for that specific period, as I need to pay where I move as a tenant.
hope you will be able to provide the answer my question-
I am in process to do an extension my property, and as my both childrens have severe eczema conditions, builder is suggesting to move out when they start knocking down the internal walls.
which means I have to move out as a tenant, i did call to my mortgage lender to understand my position if I switch from repayment to interest only (for 2-3 months), they advised that it has to go through specialist team (which indirect mean financial difficulties team) and mentioned to me if I do so, it will go on my credit file but the advisor not advised what it will say in credit file as I will not miss the payments- it will just interest only for that specific period, as I need to pay where I move as a tenant.
Please can someone had the same experience or has knowledge about this that what it will impact on my credit file in the bureau?
regards
regards
0
Comments
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You are going to fail to meet the full payments on time, so it is an accurate report to show them as 'missed'.Agreeing it in advance avoids other consequences, but doesn't change the fact that you will not be making the payments you agreed to make on the dates you agreed to make them so the lender is obliged to report it...0
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Yes it is technically missed payments and it will complicate your mortgage and credit file. Why do an extension if finances are tight? What if the cost of this project escalate (as they normally do) and you are already showing that you are struggling as you are trying to go to interest only? Building works costs more than planned and you might be “stuck in rental causing further financial upheaval. Just saying 🤷♀️Initial mortgage bal £487.5k, current £258k, target £243,750(halfway!)
Mortgage start date first week of July 2019,
Mortgage term 23yrs(end of June 2042🙇🏽♀️),Target is to pay it off in 10years(by 2030🥳).MFW#10 (2022/23 mfw#34)(2021 mfw#47)(2020 mfw#136)
£12K in 2021 #54 (in 2020 #148)
MFiT-T6#27
To save £100K in 48months start 01/07/2020 Achieved 30/05/2023 👯♀️
Am a single mom of 4.Do not wait to buy a property, Buy a property and wait. 🤓0
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