Help? :s

Summer_Rain_5

I am in a tricky situation with regards to my current mortgage and wonder if there are any suggestions or advice to help?

My current deal is about to run out with Halifax in December which was a two year corking deal at 3.75% or very similar. As you can imagine, when this ends I will automatically go up to a much higher rate. Whilst looking about for options I realised that no lenders are interested in helping us and here is why....

Current Mortgage Amount £120,000 [33 years to pay]
Secured Loan £25,000 [24 years to pay]
House Value £180,000
Salary £20,000

Noone will lend me 7 times my salary and rightly so. Thus I am stuck with Halifax and whatever they can offer. As myself and my good lady are right on the very utmost limit of our budget I feel that this new monthly increase on our mortgage payments is going to crush us. We have two little children and another is on the way and so moving to a smaller house seems an unviable option.

We had a meeting with an Abbey national mortgage advisor on Saturday and she said it might be worth going on an interest only plan for a few years until our situation for income is better etc. Any thoughts?

I am deeply worried, and would so appreciate some advice here.

Thanks in advance.

Summer Rain.

Summer_Rain_5

Oh dear! Things must be bad for me if you learned folks cannot suggest anything?

Hellllppppppp me?

SR

lisyloo

Have you spoken to the Halifax?
Your best option may be to stay with them.
What rates have they offered?

It's difficult for people to help because 7 times salary is a massive financial commitment.

Going interest only for a few years may help but you have to look at this as a temporary stop gap.

Perhaps if you explained your situation a bit more, others might have a few suggestions.
Did you not consider the financial impacts of having a large family before starting a third child, or has something unexpected changed your circumstances?

N9eav

I am with Nationwide. When my deal ran out, they were obliged to offer, me the same deals as were open to new borrowers. Maybe you can have one of their latest deals? You won't get 3.7% though you might be able to get 4.39%

here?

herbiesjp

Halifax do not have the same policy as Nationwide - i.e. their better deals are for new customers only

N9eav

herbiesjp wrote:

Halifax do not have the same policy as Nationwide - i.e. their better deals are for new customers only

That's pants. Good old Nationwide then. No revaluation fees and I did the switch to a better deal from the good deal I was on over the phone in 2 minutes

Ian_W

N9eav,
Sorry, I think you're barking up the wrong tree with that advice.

NW aren't "obliged" to offer you the best deals, it's their policy to do so, hence the ads. Those "brand new customers onlee!" jibes are aimed at Halifax [& Abbey] who don't allow existing customers access to their headline rates.

Never the less, Summer rain, first port of call has got to be Halifax to see what retention rate they may offer you. Going IO and/or extending the term [though I notice the mortgage is already for 33 years!] may be ways of making it more affordable. After that, other than see what the Abbey advisor says, I'm afraid I can't offer any suggestions! Sorry, but BoL.

EDIT: Beaten to it!!

Summer_Rain_5

lisyloo wrote:

Did you not consider the financial impacts of having a large family before starting a third child, or has something unexpected changed your circumstances?

The new baby on the way was not planned. But he/she is coming now and I have to deal with it!

SR

Summer_Rain_5

Ian_W wrote:

Never the less, Summer rain, first port of call has got to be Halifax to see what retention rate they may offer you. Going IO and/or extending the term [though I notice the mortgage is already for 33 years!] may be ways of making it more affordable. After that, other than see what the Abbey advisor says, I'm afraid I can't offer any suggestions! Sorry, but BoL.

Will be calling them shortly to see what they can do. I have been told it will be somewhere around 5.1%, which is going to increase my mortage monthly payments a fair bit. *grits teeth together and crosses fingers*

SR

Ian_W

Only other possibility I can think of is, if secured loan is also with Halifax, could it be consolidated into your main mortgage? Would be cheaper as the term is longer.

Obviously going IO, extending term, consolidating loan etc are all to be avoided if possible but given your OP they may help keep you afloat in the short/medium term but will need sorting eventually. Again, BoL.

meanmachine_2

I was going to crunch the numbers for you, but none of the online calcs go up to 33 years! Gulp!

I can only suggest you go interest only and make sure that you are claiming child tax credits.

And for others considering taking out a big mortgage, I'd only say can you afford to pay it should interest rates double, or if your partner falls pregnant? If not, then don't buy.

Good luck - let us know if you have any joy.