Mortgage I can't Afford

Treaddie

I took out a re-mortgage in Jan 2005 for £108,000.00. I am aged 51 so it's obvious to see that this was a mortgage I could not afford. My financial adviser made it seem that he was doing me a favour as I was due to be made redundant in March 2005. The mortgage is interest only at some £650.00 per month, I have only just realised that he filled out forms detailing my pay as £31000.00 per year when I was on only £15,000.00 a year.

If anyone has any ideas I would be eternally grateful. Have no funds put aside to cover the shortfall when the mortgage expires.

sassybooboos

same happened to me advisor put me down as earning £55000 i was earning no where near that.

unfortunately it came to the point where i was borrowing money from family for food cause everything was going on paying for house.

i have now sold house although had to pay a £7000 redemption for selling early, now living in a cheaper not so nice house but i have peace of mind again.

could you not move, or if not that option could you rent out some rooms to help pay mortgage. look in your local paper will give you idea of what you could get for your rooms.

foxwales

At your age; having an outstanding mortgage of £108k on an interest only basis at £650 per month is not good. With your redundancy looming it seems that you will have little opportunity to maintain your mortgage unless you have another job lined up where you can maintain the payments.

If you have no mortgage protection and your redundancy package can't tide you over until you secure a new job; then you should seek help.

Being redundant you are going to have limited options as to what you can do with the house. You can't really downsize as I would imagine you will be slapped with charges from the mortgage company for early redemption.

If you were sold the mortgage not knowing that your earnings had been over inflated or that they were aware of your redundancy situation; you could perhaps use this to your advantage if you lodge a complaint with the mortgage provider.

I would suggest though that you contact your local Citizens Advice Bureau as they will be able to assist with your finances; check your entitlement to benefits and also look at ways to maintain ownership of your house.

dwsjarcmcd

Treaddie wrote: »

I took out a re-mortgage in Jan 2005 for £108,000.00. I am aged 51 so it's obvious to see that this was a mortgage I could not afford. My financial adviser made it seem that he was doing me a favour as I was due to be made redundant in March 2005. The mortgage is interest only at some £650.00 per month, I have only just realised that he filled out forms detailing my pay as £31000.00 per year when I was on only £15,000.00 a year.

If anyone has any ideas I would be eternally grateful. Have no funds put aside to cover the shortfall when the mortgage expires.

I guess that I have a few questions about this
- Why has it taken you over 3 years to work this out?
- If you earned £15k, did you not work out pretty early that you couldn't afford a £108k mortgage?
- What was your previous mortgage amount before you re-mortgaged?
- Why is it obvious that at 51, you can't afford a mortgage?
- How have you managed to pay the £650p.m
I could go on, and I'm sorry for your predicament but on the basis of what you've posted, there are more questions than answers!

David

poppy10_2

Treaddie wrote: »

I took out a re-mortgage in Jan 2005 for £108,000.00. I am aged 51 so it's obvious to see that this was a mortgage I could not afford.

If it was so obvious, why did you take out the mortgage?

sarkin

Please sir I borrowed to much now I cant pay back, It's the brokers fault because I signed the paper work. The problem you have is that rates went up and now you cant pay. No doubt we will see a lot of this in the near future

foxwales

The poster has come here looking for advice; so a mistake was made; it doesn't help people ripping into him on here.

We all make mistakes.

homer_j_3

Seriously, it should be questioned to why you went along with it, but to be fair, it may have been affordable if they were in a low fixed rate for last 3 years and they have just come out of this.

I am going to try and be non judgmental about this and say that you may have recourse with the FA if you can prove that you were honest and they lied. You may have no recourse because the adviser has covered their backside very well.

The important thing here is to work out what YOU can control and what YOU can do.

What is the house worth?
What are rental prices like in your area?
What are the possibilities of getting a better paid job or working more hours/increasing your income?

Based on a 650 mortgage, you will probably need the same again in your pocket to be able to meet the rest of the bills - providing you have no other debt.

I would look at maybe working overtime, a better paying job or even a 2nd job if you want to sort this out - if selling your home is not an option.

neas

indeed people overstretching themselves will become a popular site now lenders raising rates.

christabell

What's done is done, now let's work on what we CAN DO today.

1.Are you still working?
2.Can you work out a budget please or a SOA?

If we see your figurers we may be able to help you with a plan.

Is there any way that you can change the mortgage to Capital?

herbiesjp

Can you take in a lodger?