FabSwingers.com forum: Interest only mortgage

By (user no longer on site) OP
over a year ago

I currently have a repayment mortgage. 1 year into a 25 year term. I need to reduce my outgoings to help with a family matter. Is it hard to do? I’m with

Santander.

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By *ddibleMan
over a year ago

Exeter Bristol Salisbury

Look at the redemption period of your mortgage, you will probably find you are tied in to a set period- normally 2 to 4 years, it can cost as much as 10% of the loan value to change products before that time.

Interest only is always cheaper but only worth considering if you don't plan on staying in the property for the full term of the mortgage

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By (user no longer on site) OP
over a year ago

"Look at the redemption period of your mortgage, you will probably find you are tied in to a set period- normally 2 to 4 years, it can cost as much as 10% of the loan value to change products before that time.

Interest only is always cheaper but only worth considering if you don't plan on staying in the property for the full term of the mortgage"
Hi I was thinking that myself. I’ve no notion of staying in the property the full term. My fixed period is 2 years so I can’t see me being able to change it.

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By *ddibleMan
over a year ago

Exeter Bristol Salisbury

Look at other areas to reduce costs- shop at Aldi, reduce you mobile phone plan, tv and broadband package. Cut back on social spending or live like an miser.

But seriously first look at ways to reduce your living costs

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By *ady LickWoman
over a year ago

Northampton Somewhere

I would say being so earlier into your mortgage term it might be tricky and as the poster above said you usually have to pay to change your mortgage deal.

Interest only can save you money but only do it as a short term thing as you never pay off any mortgage.

Can you look at other ways to save money? Do you have a spare room for example?

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By *ddibleMan
over a year ago

Exeter Bristol Salisbury

"Hi I was thinking that myself. I’ve no notion of staying in the property the full term. My fixed period is 2 years so I can’t see me being able to change it. "

Not worth changing mortgage at this time the cost would be to great. As I said in my second answer cut back on spending and try to look at ways to reduce your fixed costs

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By (user no longer on site)
over a year ago

Interest only is always cheaper but only worth considering if you don't plan on staying in the property for the full term of the mortgage Hi I was thinking that myself. I’ve no notion of staying in the property the full term. My fixed period is 2 years so I can’t see me being able to change it. "

Likely going to cost you more to change than it saves you. Money saving expert website I believe links to a calculator where you can input your detail and it shows what you're in for or at least the cost of changing whilst tied in

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By (user no longer on site) OP
over a year ago

Yeah I’ve spare room. But my sick sister will be in it. We need money for her. Long story

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By *icketysplitsWoman
over a year ago

Way over Yonder, that's where I'm bound

"Yeah I’ve spare room. But my sick sister will be in it. We need money for her. Long story "

Sorry to hear your sister is sick and you'll be caring for her. Is it possible to register her as a tenant and get rent payments (through benefits) for her to help cover the costs?

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By (user no longer on site) OP
over a year ago

"Yeah I’ve spare room. But my sick sister will be in it. We need money for her. Long story

Sorry to hear your sister is sick and you'll be caring for her. Is it possible to register her as a tenant and get rent payments (through benefits) for her to help cover the costs?"
not sure just yet. We will figure something

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By *ophieslutTV/TS
over a year ago

Central

If interest rates rise - as predicted - an interest only mortgage will see repayments jump.

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By *ddibleMan
over a year ago

Exeter Bristol Salisbury

"Yeah I’ve spare room. But my sick sister will be in it. We need money for her. Long story

Sorry to hear your sister is sick and you'll be caring for her. Is it possible to register her as a tenant and get rent payments (through benefits) for her to help cover the costs? not sure just yet. We will figure something "

Sadly you can't claim housing benefit for a relative.

I care for my sister (she had a stroke), she is unable to work but she is entitled to benefits to cover her living costs as well as additional benefits to aid her mobility. It's a bit of a minefield with the amount of forms and I had to support her financially during the 6 weeks it took for the claim to go through.

I really do feel for you so please feel free to PM me if you need any help or advice I've been there and it's not easy. I will gladly do what ever I can to help

Good luck and best wishes

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By * and M lookingCouple
over a year ago

Worcester

Interest only is just renting from the banks.

Gets you nowhere unless you want to live like a king on paupers money.

Plenty like that near us....we call them new money.

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By *imited 3EditionCouple
over a year ago

Live in Scotland Play in England

Can you contact your bank and ask about mortgage holidays? Some mortgage deals allow these.. Not sure if it'll cover you for the period of relief you might need though.

Hope your sister gets back to full health soon x

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By *nnie2009Couple
over a year ago

Blackpool

"Yeah I’ve spare room. But my sick sister will be in it. We need money for her. Long story "
hope you get sorted and you're sisters health improves

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By (user no longer on site)
over a year ago

"I currently have a repayment mortgage. 1 year into a 25 year term. I need to reduce my outgoings to help with a family matter. Is it hard to do? I’m with

Santander. "

Go talk to Santander, they might be able to extend the term to 30 years. That would reduce your monthly repayments.

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By (user no longer on site)
over a year ago

Maybe you could speak to your mortgage provider, explain the situation and ask if you can switch to a longer term loan, thus cut payments down.

I would say get down to citizens advice and find out what your sister is entitled to claim benefit wise.

We don't know what the situation is but is it a possibility that someone could start a funding page for her on one of those pages that people use?

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By (user no longer on site)
over a year ago

I know you're stuck with with your mortgage this time but have you looked at other ways to trim your out.

I moved over to utility warehouse and was able to consolidate all of my bills through one place. It does tinternet and mobile phones too.

It costs nothing to look.

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By *ynecplCouple
over a year ago

Newcastle upon Tyne

Unlikely as others have said that you could change. If it is only a short term crisis speak to the bank they might let you take a payment holiday or be able to do something you help.

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By *unloversCouple
over a year ago

rotherham

Could you possibly get carers allowance

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By (user no longer on site)
over a year ago

My advise would be stay as you are, don’t do interest free your not paying off the debt!!

Keep going it’ll get easier

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By *rontier PsychiatristMan
over a year ago

Coventry

I wouldn't go down the interest mortgage route if I were you, unless to know of some big windfall coming in the future to cover the capital or a predicted rise in earnings to start turbo saving. If not an interest only means you still cant afford the house and you'll just be paying the bank money and lose the house anyways. I think your best route is a mortgage term length extension to reduce the monthly payment.

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By (user no longer on site) OP
over a year ago

Thanks all. I’ve reduced my spending as best I can. I really don’t live like a king at all. But I will review it again. Thank you all for your input it’s appreciated.

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By (user no longer on site)
over a year ago

Realistically, at such a short period into the mortgage, changing to interest only is not going to save much. The first few years, you pay very little off the actual loan, it's only as the capital starts being replayed the interest comes down. Half way into the mortgage, you will be lucky to have paid 25% off the capital.

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By (user no longer on site)
over a year ago

I’m prett sure you can only get interest only mortgages now on a buy to let. Have you thought about renting out a spare room? I think you can charge up to £100 per week with out having to pay tax on it.

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By *icecouple561Couple
Forum Mod
over a year ago

East Sussex

"I wouldn't go down the interest mortgage route if I were you, unless to know of some big windfall coming in the future to cover the capital or a predicted rise in earnings to start turbo saving. If not an interest only means you still cant afford the house and you'll just be paying the bank money and lose the house anyways. I think your best route is a mortgage term length extension to reduce the monthly payment. "

I agree. I've heard of so many cases recently where people have come to the end of the term of their interest only mortgage and need to find x hundred thousand pounds. I don't know if they were missold or thought they would have the money by then.

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