Interest Only Mortgage

Dinky1975

Hi I have an interest only mortgage and now as the rate has gone up finding it difficult to meet the payments.  I know I should have switched before now but this is due to circumstances with husbands ill health and no longer working so only my income. Will things settle down? Unsure whether to sell but then would it sell in current climate? Any advice appreciated many thanks 😊 

dunstonh

Will things settle down?

The long term average mortgage rate is around 7%.     So, we are still below that level with most deals.     There is no expectation that rates will return to post credit crunch levels as they were a historic abnormality.   Rates were always going to rise at some point.  They would have done several years ago had it not been for Coronavirus extending the printing of money.

As much as anyone's crystal ball can guess..... The headline rate is expected to rise further but long term fixes are pretty close to their peak.   They will begin to fall back in a year or two but only by small amounts.      Unknown events and reduced/increased commercial activity may see more aggressive or less aggressive pricing.  i.e. less new mortgages may see lenders target borrowing by reducing their margins.

Are you old enough to consider equity release?

Dinky1975

I'm 48 this year? So presume not

TimSynths

Is the payment cheaper than the equivalent rent? If you sell up what will you do?

MorningcoffeeIV

Dinky1975 said:

I'm 48 this year? 

You don't sound sure.. 

dimbo61

You need to sit down and talk to someone who can give you good advice. 
If you can't afford an Interest only mortgages what are your plans to repay the debt in 17 years when you hit 65 if that's  how long the mortgage lasts?
You might be living in a studio flat in Hull or a 10 bed mansion in Chelsea for all we know.
Work, pay, pensions, savings, benefits, kids, partner ??????
It's good to talk and find out your options