Can't pay off, can't sell

Wanderer78

Hi, a pensioner friend is trying to sell her house as her mortgage is up and they won't let her remortgage due to her age. However she can't pay the balance until she sells the house. Has anyone come across a similar situation? 
The remaining balance is only 10% of the asking price but she's struggling to get interest and the deal will likely expire before the sale. Are providers flexible on this generally?

housebuyer143

parkerusm said:

Hi, a pensioner friend is trying to sell her house as her mortgage is up and they won't let her remortgage due to her age. However she can't pay the balance until she sells the house. Has anyone come across a similar situation? 
The remaining balance is only 10% of the asking price but she's struggling to get interest and the deal will likely expire before the sale. Are providers flexible on this generally?

No not really but they will not start court proceedings to repossess the house if it's on the market and she is making active steps to sell the property. 
Recommend she speaks to them to inform them of her inability to repay at the end of the term.

Keep_pedalling

Are there other reasons she would like to sell? If not and she would prefer to stay put then she could look at equity release.

MWT

Keep_pedalling said:

Are there other reasons she would like to sell? If not and she would prefer to stay put then she could look at equity release.

Agreed, if she only needs 10% of the value then as long as the property is suitable for ER that would seem like the best choice.

RetSol

Has she spoken to a mortgage broker? She may not now meet the criteria of her existing lender but another lender may be willing to lend to an older borrower.

What about exploring a retirement interest only mortgage - https://www.which.co.uk/money/mortgages-and-property/mortgages/types-of-mortgage/retirement-interest-only-mortgages-explained-axF6i0R8o3uP. 

And there is the possibility of equity release, as has been mentioned above. 

With a low loan-to-value, she probably has options. 

She must start to talking to her existing lender about the situation and what she is doing about it, if she has not already done so.  They can't be flexible about a situation which they are ignorant of. 

ACG

The problem is that the house is not selling at the price it is up for. Everything has a price, your friend obviously wants more than its value. 

The lender might be a little relaxed for the first couple of months if they can see it is on the market, but once you get to 6 months they are probably going to be applying a bit more pressure and your friend might start incurring costs for the lender to investigate why it is not selling. 

But as others have said, speak to a broker there are potential options:
Some lenders have no stipulations on age, in fact some products are specifically geared to older borrowers - Retirement interest only (RIO) mortgages for example and equity release (not like it was in the 80s/90s). 

MWT

Given the relative modest needs and the costs involved in ER, I'd probably suggest an initial conversation with StepChange Financial Solutions, as they can talk through her needs and cover RIO and ER options on a no fee basis.