refinancing mortgage with dropped home value

a03b

I closed jan 2025 at 85% LTV. 35 yr mortgage with 2yr fixed 4.5%

Looking to refinance now but home value has dropped a bit. The whole market came down as you know

Despite doing monthly payments my mortgage balance declined very little as they all went to interest. Now I feel I may be at >85% LTV

what happens now practically? If I'm asked to do a one off payment I can't because I have no cash

Woodstok2000

Speak to your mortgage provider and/or a broker to see what options are available. Lots of mortgages at >85% ltv.

El_Torro

One option would be to stay with your current mortgage lender. They will make you an offer without revaluing your property, as long as you're not looking to borrow more. The interest rate they offer you may not be the most competitive one out there though.

RelievedSheff

As you have discovered the problem with longer term mortgages is that in the early days your repayments are almost all interest and you make very little inroads into repaying the loan amount.

You should still have plenty of choice of remortgage offers even at 90% LTV or do a product transfer with your existing lender, although this will leave you on a long mortgage term repaying very little capital.

Yorkie1

As others have said, if you do a product transfer with your current provider, there are no more checks done. Perhaps do a comparison of what you would get with your current lender, against 90% rates from other lenders to see how it pans out.

If you have capacity to start overpaying, even if it's just by a few ££ per month, that will eventually offset (not in a true mortgage sense) what you owe vs the property's value.