Mortgage Prisoner.

landlord999

Im a mortgage prisoner with wave lending, who are part of mortgages plc, my mortgage deal ended a few years ago so I am on standard variable which tracks the BOE base rate, neither banks are operating anymore so they will not offer me a new mortgage deal, due to affordability rules I cannot go to another lender and qualify for the amount I need so I am stuck where I am. Im on interest only and I have never missed a payment ever, my mortgage rate is now about 8% and my interest only payments have risen from £480pm to £1700pm and im now panicking!! What can I do? Can I get compensation from my lender as I could be on something between 2-5% had they offered me new deals? Will another lender help me, if so who? I dont know what to do...

MovingForwards

You'd be better off posting on the mortgage board, further down the forum.

MattMattMattUK

landlord999 said:

Im a mortgage prisoner with wave lending, who are part of mortgages plc, my mortgage deal ended a few years ago so I am on standard variable which tracks the BOE base rate, neither banks are operating anymore so they will not offer me a new mortgage deal, due to affordability rules I cannot go to another lender and qualify for the amount I need so I am stuck where I am.

That is an unfortunate situation, but it does indicate a bigger issue, you cannot afford the property.

landlord999 said:

Im on interest only and I have never missed a payment ever, my mortgage rate is now about 8% and my interest only payments have risen from £480pm to £1700pm and im now panicking!!

The fact that you are on an interest only mortgage is a bigger issue, almost no banks now allow new applications for interest only mortgages and those that do only do so in very specific circumstances, such as having a large investment which will be used to pay off the mortgage, selling the property at the end of the term is not adequate.

Your interest only repayments would indicate a mortgage of £255,000, a new mortgage would need to be on a repayment basis and at current rates over 25 years it would cost £1,566 pcm, over 35 years that would drop to £1,369 and over 15 years that would rise to £2,084 pcm, generally most mortgage lenders will only lend up to retirement age or a few years beyond.

landlord999 said:

What can I do?

If you can you afford the payments on a new mortgage on a repayment basis based on affordability checks? If you cannot, then you cannot afford the property and will need to sell and downsize. The only other option would be if you are at pension age, in which case you may be able to get a lifetime mortgage, but again, specific circumstances apply, you need significant equity in the property and it will mean that there will be no equity left in the property in 10-20 years. 

landlord999 said:

Can I get compensation from my lender as I could be on something between 2-5% had they offered me new deals?

No, you cannot.

landlord999 said:

Will another lender help me, if so who?

Another lender will lend to you if you meet their lending and affordability criteria, but those are generally very similar across all lenders. 

landlord999 said:

I dont know what to do...

I suspect you need to sell the property and downsize to something that you are able to afford.

MovingForwards said:

You'd be better off posting on the mortgage board, further down the forum.

I have requested a move, although the mods do not work weekends so it will likely not get actioned until tomorrow.