Interest only mortgage term has run out & i still owe £12700

TC5705

Hello.
My interest only mortgage term is about to run out & i still owe £127000.

I am aged 60, my property is worth £400000. 

What are my options? I would like to stay here & prefer not to downsize. I don't like the sound of equity release. 

Is there a company that would grant me a 10 or 15 mortgage preferably interest free or any other financial products i could source?

I have never missed a payment in 25 years on the mortgage & i have a high credit score.

Any advice or solutions would be very much appreciated.

Regards & Thank-you

ACG

There are products called RIO mortgages, retirement interest only. 
They may be a solution. 

But really it depends on what your income is now and once you retire if you plan on retiring within those 10-15 years. 

Speak to a broker. With the level of equity you have there should be options if the income is there. 

dunstonh

What are my options?

Most lenders will extend if you have no defaults/arrears and a means to repay the mortgage in due course.  e.g. you are 60 and if you are still working and finishing at state pension age, they will extend the mortgage to age 67 on repayment basis.  

Some may consider retaining you on interest only if you have provable means of repaying the debt at the end of the term.  e.g. pension lump sum (but you would need to prove it)

Is there a company that would grant me a 10 or 15 mortgage preferably interest free or any other financial products i could source?

Nobody is going to give you an interest free loan.  

Ultimately, you could consider equity release but that is an option of last resort.  Blowing that option whilst you are still working leaves you little fall back in retirement.

I have never missed a payment in 25 years on the mortgage & i have a high credit score.

Lenders do not use the "marketing" score that a credit agency does.   Whilst you may score high, the reality is somewhat different and you are not a strong credit worthiness as the score suggests.   Lenders look at your scenario. Not a score.

K_S

@tc5705 You're 60, no credit issues, owe a relatively small amount of money, are at sub-50% LTV and have a decent chunk of ££ equity. All positives when it comes to later life lending options.

If you have the post-retirement income to support a 125k loan size (as per lender calcs), you could potentially remortgage (new lender) to a standard mainstream mortgage on a capital repayment mortgage. There are lenders that will go to 80-85-95 years of age for lending in/into retirement so that should give you a decently long enough term.

Alternatively, a RIO mortgage as mentioned above. Low outgoings, affordability based on the interest only payment, relatively easy to qualify for and relatively easy to understand.

Might be worth speaking to someone like Stepchange's (the debt advice charity) mortgage advice arm who advice on both standard and later life lending. Good luck!

TC5705 said:

Hello.
My interest only mortgage term is about to run out & i still owe £127000.

I am aged 60, my property is worth £400000. 

What are my options? I would like to stay here & prefer not to downsize. I don't like the sound of equity release. 

Is there a company that would grant me a 10 or 15 mortgage preferably interest free or any other financial products i could source?

I have never missed a payment in 25 years on the mortgage & i have a high credit score.

Any advice or solutions would be very much appreciated.

Regards & Thank-you

MWT

TC5705 said:

What are my options? I would like to stay here & prefer not to downsize. I don't like the sound of equity release. 

Good that you are not thinking of Equity Release as your solution, frankly, you would probably need to be at least 5-10 years older to get £127k out of a £400k property... ... and you can't have Equity Release alongside a RIO or repayment mortgage.

You don't mention a partner, but assuming you are single and sole owner of the property, as long as you are still working and earning enough and have sufficient guaranteed income in retirement, you should still have RIO options if you want an interest only solution (I assume that is what you were asking for rather than 'interest free' which is impossible).

 

AMILLIONDOLLARS

I am assuming your endowment policy under performed and did not cover the cost of the amount outstanding, did you not receive your red letter warnings you that this would happen?  If you did not, you should be reporting this the FCA.  All endowment mortgage holders were given options when sent their yearly statements by their mortgage providers on what they could do to reduce their outstanding balances, if your provider failed to do this you may have some form of address.  failing this, if you can't get a new loan then downsizing may well be your only option,  but ask yourself this question do you really want to be paying off a Mortgage into your 80s

dimbo61

There are a number of lenders who will lend to customers upto 75/80 years of age. Start overpaying the mortgage now by whatever you can afford each month.
You still have 7 years to state retirement age.

Sistergold

On title is saying you owe £12.7k and later in text you say £127k? 🤷‍♀️