Stay interest only or repayment?

Mattsam

Hello,

Apologies in advance if this is a bit of a ramble. Myself & my husband are currently on an interest only mortgage, but would like if possible to convert back to repayment. At present I am on a career break from my job for 5 years, and pregnant with our third child so we are living on 1 wage of approx £1600 per month which we are managing on.At present the interest only mortgage costs £ 649 per month, but we are trying to think of ways to generate more money, as I have spoken to our mortgage lender who say to continue with the term of the mortgage 22 years, would cost £935, or to increase the term to 30 years £814.

The only other outstanding debt (apart from the usual bills) is a car loan of £150 which has approx 4 1/2 years left. We know paying this of would help, but obviously are not in a position to do so at present.

Any advice greatly appreciated.

wymondham

Sounds like you're coping fine as you are - keep interest only for the time being?

allan673

obviously its better for you to revert to full repayment as your not paying any capital off the mortgage - but when you can afford to do so.
youve answered your own question really.
you could try interest and part capital if your lender lets you.

Gorgeous_George

If you can save, in ISAs etc., at a rate higher than your mortgage rate, do that. If not, decide on a date to go repayment and plan to achieve that after saving a little for a rainy day.

GG

dimbo61

hi mattsam ?? your two boys ?? good luck with the pregnency and birth
of your daughter/son.
as the others have said stick with interest only untill you go back to work.
if you can then build up some savings in ISA,s with barclays paying 6.5% at the moment.
make sure you are claiming all the benefits you can get ( and have paid tax and NI for over the years). If you income is less than £16,000 a year you can get WTC, CTC, CB, and help with bills like WATERSURE if you have 3 kids under 19 !! call into your local job centre ( OR WHATEVER ITS CALLED TODAY) and ask what you can claim GOOD LUCK