Trapped as mortgage rate coming to end - Help Please
thewrongtrousers
Posts: 59 Forumite
Hope it is okay but I am posting this on behalf of some friends who are struggling to find a way to remortgage. We're hoping that someone has advice or has been in a similar position and found a way out.
Situation:
Two friends who have two young kids. They are self-employed and their income is fairly low, although they have had their current mortgage for 4 years. Their income has actually gone up since they first got the mortgage with the current provider.
The current mortgage rate is coming to an end and their bank is saying they will have to reapply for a new product (regulation changes since last mortgage) or stay on the higher VR. However and this is the issue, their income is such that the provider will not give them the full amount they need if they switch to a new product, (case of computer / affordability calculator says NO).
They have tried various mortgage brokers including those that specialize in the self-employed but all are coming back with the same issue.
They face either having to sell the house or paying £150 a month more than they currently do because they are unable to get a new mortgage deal.
To me this seems really odd as the bank has given them the mortgage (with a lower income declared) in the first place and now effectively trapped them in a VR mortgage where they would actually be paying more, after 'Google' searching for a few days I really can't find anything that will help them (but I'm maybe using the wrong search terms) so am hoping some MSE's can.
Thanks in advance
Situation:
Two friends who have two young kids. They are self-employed and their income is fairly low, although they have had their current mortgage for 4 years. Their income has actually gone up since they first got the mortgage with the current provider.
The current mortgage rate is coming to an end and their bank is saying they will have to reapply for a new product (regulation changes since last mortgage) or stay on the higher VR. However and this is the issue, their income is such that the provider will not give them the full amount they need if they switch to a new product, (case of computer / affordability calculator says NO).
They have tried various mortgage brokers including those that specialize in the self-employed but all are coming back with the same issue.
They face either having to sell the house or paying £150 a month more than they currently do because they are unable to get a new mortgage deal.
To me this seems really odd as the bank has given them the mortgage (with a lower income declared) in the first place and now effectively trapped them in a VR mortgage where they would actually be paying more, after 'Google' searching for a few days I really can't find anything that will help them (but I'm maybe using the wrong search terms) so am hoping some MSE's can.
Thanks in advance
0
Comments
-
Why can't they just ask for a product switch with their existing lender upon the ending of their current deal. As long as no additional money is required and the term of the mortgage doesn't change Banks usually offer a simple product switch once the initial deals ends. That product switch (in my experience) doesn't require a new application and with most banks doesn't even involve a credit check etc.0
-
Why can't they just ask for a product switch with their existing lender upon the ending of their current deal. As long as no additional money is required and the term of the mortgage doesn't change Banks usually offer a simple product switch once the initial deals ends. That product switch (in my experience) doesn't require a new application and with most banks doesn't even involve a credit check etc.
+1 - I'm going through a product switch with my mortgage provider now0 -
Who is the lender?0
This discussion has been closed.
Categories
- All Categories
- 343.2K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608K Mortgages, Homes & Bills
- 173.1K Life & Family
- 247.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards