Extending mortgage term but house is on the market

Lastbutnotleast1234

Hi, my house is for sale as part of a divorce settlement. My ex and my joint fixed rate mortgage came to an end just as we were putting the house on the market. We contact our lender (HSBC) who allowed us to move to 6 months interest only. That is due to end this month and the house is still not sold. I contacted HSBC to see if they would extend the mortgage term to avoid moving to the extortionate SVR. They agreed and put me in touch with their mortgage advisor. They have just told me that as the house is on the market they cannot extend the mortgage term and therfore my monthly costs will go up by c £1500 pcm. I simply can't afford that. They said there is only flexibility in exceptional circumstances. I'd appreciate any advice as I am worried sick. I have no mortgage arrears and c50% LTV. 

Hoenir

The switch to SVR has nothing to do with your contractual mortgage term. Be a condition of the last mortgage fixed term product. 

TheSpectator

More importantly why isn't the house selling, is it overpriced? Are you holding out for a price?

Newbie_John

Lower the price and sell quicker?
Take off the market, do a product transfer, pick a new rate and then pay Early Repayment Charge?

Not really sure if you can do more, house hasn't sold in 6 months, you were probably on 1.5% rate before so facing a new 4.5% rate now, standard rate is 7-8%, you could possibly choose tracker? But what's the plan if the house doesn't sell in a year, two.. time?

Lastbutnotleast1234

Thanks for the responses. I am trying to reach an agreement with my ex-wife to reduce the value of the property to achieve the sale but that is proving tricky and I may need to return to court to compel that to happen. All of which will take time. 

The issue really is that I need to keep the payments to as low a level as possible whilst this happens and we hopefully eventually achieve a sale. I do not want to enter into another mortgage deal with my ex-wife as that would be inappropriate but I need to change the deal we are on. As I say the fixed rate was changed to interest only for 6 months and the suggestion was I could then extend the term if the property wasnt sold. I am now told the term cant be extended as the property is on the market - which seems bizarre. Surely even if I hadn't gone through a divorce the sensible thing would be to sell if costs have gone up to an unaffordable level. I'd hoped the lenders would be more understanding in the circumstances........

amnblog

Go to a mortgage Broker and have them swop you on to a HSBC tracker rate until you sell. These have no early repayment charges. Depending on your loan to value, you can get a rate from 5.59%.

Alternatively, if you will need a mortgage on a new property once you sell this one, you may be able to consider other rates that you can take with you to the new property.

Hoenir

Lastbutnotleast1234 said:

 I am trying to reach an agreement with my ex-wife to reduce the value of the property to achieve the sale but that is proving tricky and I may need to return to court to compel that to happen. All of which will take time. 

Hence the mortgage lender will maintain the pressure on both of you to resolve the issue.