Advice - Mortgage

kossohead

Hi guys, need some general advice please.
My current Natwest mortgage finishes in December 2025 and have exactly 2 years left from Jan 26.
My balance is £57,000 which is £13,000 capital and interest, and £44,000 interest only. I have just received a payment into my bank account of £37,000 endowment payment for the £44k interest only mortgage (7k shortfall).
What are my options? 
Any advice would be most appreciated.
Kind Regards x

tacpot12

What early repayment options and charges apply to the Capital & Interest and Interest-Only parts of your mortgage?

singhini

If i have understood this correct, you have £37k in the bank but a 2 part mortgage and owe £57k.
Also your mortgage fix finishes in Dec 2025 but you still have 2 years left.
Finally you most likely dont have any other meaningful savings other than the £37k and so your worries you might not have the £7k shortfall on the interest only mortgage in 2 years time.

i would be tempted to pay down the interest only mortgage by £37k and then look into a new mortgage deal

Option 1 = See if NatWest will let you convert ALL remaining £20k mortgage to repayment (£44k less £37k + £13k = £20,000) and if need be extend the term. 

Option 2 = Same as above but you re-mortgage to a different lender (for this you will need a settlement figure from NatWest so you can let the new lender know it). Note: not all lenders will give you a mortgage of only £20k as its too small but i think Nationwide and Leeds BS might do. 

grumpy_codger

kossohead said:

...
My current Natwest mortgage finishes in December 2025 and have exactly 2 years left from Jan 26.
My balance is £57,000 which is £13,000 capital and interest, and £44,000 interest only. I have just received a payment into my bank account of £37,000 endowment payment for the £44k interest only mortgage (7k shortfall).
What are my options? 
Any advice would be most appreciated.
Kind Regards x

And the interest rate(s) is (/are)...?!
Unless I am missing something this is a very important factor that your options depend on.

kossohead

tacpot12 said:

What early repayment options and charges apply to the Capital & Interest and Interest-Only parts of your mortgage?

I think the erc is 1%

kossohead

grumpy_codger said:

kossohead said:

...
My current Natwest mortgage finishes in December 2025 and have exactly 2 years left from Jan 26.
My balance is £57,000 which is £13,000 capital and interest, and £44,000 interest only. I have just received a payment into my bank account of £37,000 endowment payment for the £44k interest only mortgage (7k shortfall).
What are my options? 
Any advice would be most appreciated.
Kind Regards x

And the interest rate(s) is (/are)...?!
Unless I am missing something this is a very important factor that your options depend on.

I was paying 1.64%, the svr from Jan will be 6.99% with Natwest.

kossohead

singhini said:

If i have understood this correct, you have £37k in the bank but a 2 part mortgage and owe £57k.
Also your mortgage fix finishes in Dec 2025 but you still have 2 years left.
Finally you most likely dont have any other meaningful savings other than the £37k and so your worries you might not have the £7k shortfall on the interest only mortgage in 2 years time.

i would be tempted to pay down the interest only mortgage by £37k and then look into a new mortgage deal

Option 1 = See if NatWest will let you convert ALL remaining £20k mortgage to repayment (£44k less £37k + £13k = £20,000) and if need be extend the term. 

Option 2 = Same as above but you re-mortgage to a different lender (for this you will need a settlement figure from NatWest so you can let the new lender know it). Note: not all lenders will give you a mortgage of only £20k as its too small but i think Nationwide and Leeds BS might do. 

Thanks for the reply and your feedback.