I am genuinely confused, why can't I get a loan?

Shireknight01

https://forums.moneysavingexpert.com/discussion/comment/82007362#Comment_82007362

I was just on the phone to the provider and she said exactly that, you can't use a personal loan to pay off a mortgage.

She gave me a number for a team that specifically deals with this problem (the mortgage maturity recovery team) and told me to wait and call it the day the mortgage expires, so I'll do that and they will run through the options available to me.

Shireknight01

Just done that, they can't really help at this time they say I just need to wait until the mortgage expires and then call them, but that's not a major problem, I'm happy with that.

Shireknight01

Thank you all for your advice and being a sounding board for my thoughts, this thread has put my mind at rest about the situation and cleared a few mysteries up so thank you all :-)

marcia_

https://forums.moneysavingexpert.com/discussion/comment/82007379#Comment_82007379

at least you now know there is a team to deal with it although you have to wait must be a relief

Jemma01

Can you not get any job that's part time to help you pay it off instead of a loan?

enthusiasticsaver

As you now know borrowing on a personal loan to pay off a mortgage is problematic. Also borrowing from anyone is difficult with benefits as your only income. Rest assured the mortgage company will not repossess so when the mortgage expires presumably they will give you the option of remaining on their SVR. They may want you to restructure the remaining £15k over a fixed term which will obviously mean your repayments increasing. I don't think they will insist on you applying for a new mortgage given you are already with them so hopefully you will not have surveys etc to pay for although you may want to consider a fixed rate mortgage which may come with a fee. How old are you?

enthusiasticsaver

My suggestion in the meantime is you overpay the mortgage reserve (if you are allowed to do that) by the amount you can afford which presumably is £300 a month as you seem to think you can afford that as a loan repayment. Given you have £200 o/s and your repayments are £22 a month presumably you have about 10 months outstanding on the original mortgage term. Paying £300 a month will bring the reserve down to £12k.

How did the reserve come about in the first place? Was it a mortgage holiday which is now on interest only?