Remortgage woes

[vickster]

One of my bosses admitted he has a mortgage he'll never pay off ! Now that is bonkers !

So he'll just keep re-mortgaging ad infinitum and it'll hopefully be paid off when he dies?

 

[Hacienda71]

Refinancing over a longer term is an option but is kicking the can down the road.

 

[Gunk]

A thread to help me and others navigate the current choppy waters in the mortgage market.

So let’s hear tales of any renewal quotes, and how you will cope. I could afford a few hundred pounds increase but anything more would be a real struggle.

This was the question, most of the answers have just been about not having a mortgage anymore, not really very helpful.

We have small mortgage left, about 5 years now and we were on a tracker which was starting to get out of control with the constant rate rises, we took a risk a couple of months ago and jumped into a 3 year fixed with our existing lender at 4.35% which is now looking like a reasonable deal, 3 years may be too long but time will tell.

I am so sorry to hear about the pressure you are under, my advice is to go and see a decent “whole of market” mortgage advisor and see what your options are. My own view is that these rates are now here to stay. Like others, I also remember 16%+ back in the 1980’s but I only had a £17,000 mortgage back then. I think life is going to be very tough for a lot of people when they come off these cheap fixed rates and whilst its easy to be sanctimonious about living beyond your means with cheap borrowing, I don’t think that is the case for a lot of decent hard working people.

 

[Jody]

Still on a fixed for the next 2 odd years at 1.2%

I'll worry about the renewal then but at current rates we will need an extra couple of hundred a month.

This is the true economic timebomb of the moment.

Scary looking at how people are going to be hit. I know someone who maxed out at the peak and their mortgage will increase nearly £600+ a month when their fixed ends.

 

[Alex321]

I would agree on a first purchase, we were mortgaged initially and stayed in it until it was paid off but we saved everything we could and bought our current property mortgage free and will be doing so again when we move in a couple of years. One of the main issues is people wanting the best from the start and over stretching their budgets instead of starting with something a bit more basic and building up.

When we first bought, the advice was to go for the most expensive you could possibly afford, as inflation at that time was high enough that it would soon become "easily" affordable.

 

[Sterlo]

When we first bought, the advice was to go for the most expensive you could possibly afford, as inflation at that time was high enough that it would soon become "easily" affordable.

I worked out how much we could afford to pay monthly then saw what we could get with that. Ended up with a small 3 bed tarraced but it did us fine.

 

[Gunk]

When we first bought, the advice was to go for the most expensive you could possibly afford, as inflation at that time was high enough that it would soon become "easily" affordable.

We totally ignored that advice 20 years ago, it was second time around for both us, neither of us had much equity and we took out a colossal mortgage on a very nice four bed house in a good part of Oxford, it could could have all gone horribly wrong but ended up being the best thing we could have done. When times were good we overpaid and in five years time it’ll all be ours!

 

[vickster]

I worked out how much we could afford to pay monthly then saw what we could get with that. Ended up with a small 3 bed tarraced but it did us fine.

Cost about £500k + now in even the cheaper parts of London/SE

 

[Ming the Merciless]

I well remember double digit mortgage interest rates in the 90s. Wonder if they will return?

 

[Bonefish Blues]

I well remember double digit mortgage interest rates in the 90s. Wonder if they will return?

It's the only tool they have. They will keep hitting it until things slow.

 

[SpokeyDokey]

A thread to help me and others navigate the current choppy waters in the mortgage market.

So let’s hear tales of any renewal quotes, and how you will cope. I could afford a few hundred pounds increase but anything more would be a real struggle.

My mortgage renews in November 2024. I was hoping rates would fall by then, but it looks like they will remain high until at least 2025.

I know “high” is a relative term.

I have lived here for 18 years but I couldn’t currently afford to buy the house I live in if I was 20 years younger and had to buy it for current prices. Which is a major issue with the current housing market.

I doubt rates will fall even by 2025 - we are now paying the price of artificial and centrally propped-up interest rates.

Sooner or later this would cause major issues.

As to what to do, much depends on what is possible in terms of your personal situation.

Presume you only have 7 years left on your mortgage?

Can you extend the term, maybe even until you are 70? - some lenders are amenable.

Kill all holidays, car purchases, home improvements, meals out, non-essential subscription services etc for the forseeable future - grim, but a roof over your head is more important.

Move to a smaller property in the same location.

Move to a cheaper location.

Take cash out of a pension pot and paydown the mortgage principle.

Can someone in the household take on an additional employment.

Take in a lodger.

Kids at home? Charge a fair rent instead of the £10-20 pw nonsense that seems to be the case in our wider family.

Just a few ideas.

Good luck navigating these choppy waters.

 

[Gunk]

I doubt rates will fall even by 2025 - we are now paying the price of artificial and centrally propped-up interest rates.

Sooner or later this would cause major issues.

As to what to do, much depends on what is possible in terms of your personal situation.

Presume you only have 7 years left on your mortgage?

Can you extend the term, maybe even until you are 70? - some lenders are amenable.

Kill all holidays, car purchases, home improvements, meals out, non-essential subscription services etc for the forseeable future - grim, but a roof over your head is more important.

Move to a smaller property in the same location.

Move to a cheaper location.

Take cash out of a pension pot and paydown the mortgage principle.

Can someone in the household take on an additional employment.

Take in a lodger.

Kids at home? Charge a fair rent instead of the £10-20 pw nonsense that seems to be the case in our wider family.

Just a few ideas.

Good luck navigating these choppy waters.

Some good robust advice

 

[cyberknight]

had to downsize during the bank crash , 4 day week and permanent day shift for close to 2 years hit us hard so my mortgage finishes 1 month after i am 65 as we had to start from nothing again .
Just did a new deal last month and its going up about £30 a month

 

[Beebo]

I doubt rates will fall even by 2025 - we are now paying the price of artificial and centrally propped-up interest rates.

Sooner or later this would cause major issues.

As to what to do, much depends on what is possible in terms of your personal situation.

Presume you only have 7 years left on your mortgage?

Can you extend the term, maybe even until you are 70? - some lenders are amenable.

Kill all holidays, car purchases, home improvements, meals out, non-essential subscription services etc for the forseeable future - grim, but a roof over your head is more important.

Move to a smaller property in the same location.

Move to a cheaper location.

Take cash out of a pension pot and paydown the mortgage principle.

Can someone in the household take on an additional employment.

Take in a lodger.

Kids at home? Charge a fair rent instead of the £10-20 pw nonsense that seems to be the case in our wider family.

Just a few ideas.

Good luck navigating these choppy waters.

The problem is that if lots of people have to do this and cut back on spending the economy is almost certainly going into recession.

 

[SpokeyDokey]

The problem is that if lots of people have to do this and cut back on spending the economy is almost certainly going into recession.

And what would you rather have - no home or an economy temporarily in recession?

Do you want ideas re how to get through or are you just looking for renewal experiences?

Are any ideas in my post workable for you?

If not, they may be useful to other members although I will happily delete the post if you wish.