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Mortgage shortfall

(9 Posts)
Chippychop Tue 23-Apr-13 23:01:01

My DM 82,is going to have a £26k shortfall of her interest only mortgage in 3 yrs, she has no means of paying it off other than selling up.

Can the mortgage company force her to sell or repossess or would they put a charge on the property.. What are they likely to do?

AKissIsNotAContract Tue 23-Apr-13 23:04:22

She'll have to sell the property. I'm amazed a mortgage lender would give a mortgage to someone of that age, it's pretty irresponsible lending.

Chippychop Tue 23-Apr-13 23:06:40

It isn't a new mortgage she's had it for 20yrs but swopped a small part to IO when they had some financial problems a few years ago.

Can they force a sale then a lender???

AKissIsNotAContract Tue 23-Apr-13 23:09:05

Even so, that would have made her 62 when she took the mortgage out. Unbelievable that they would give a 20 year mortgage to someone of that age.

Chippychop Tue 23-Apr-13 23:12:06

Well that's not really the issue, I just need to work out the best path for her now

noddyholder Tue 23-Apr-13 23:14:19

She will have to sell. In some cases there are schemes to extend but I think she may be too old. I would market it now and give yourselves lots of time to eliminate stress in case it gets a bit close to the wire. This scenario is becoming very common.

AKissIsNotAContract Tue 23-Apr-13 23:15:53

I was wondering if you have a case for mis selling by the lender.

Failing that, could a younger member of the family take over the mortgage on a repayment basis?

Otherwise selling the property seems like the only option.

Chippychop Tue 23-Apr-13 23:32:15

Tbh I don't know the finer details mod the mortgage set up etc. and I'm not sure she'd be up for any legal wrangling. Maybe this is the jolt she needs to move to a smaller place - and an easier lifestyle

CogitoErgoSometimes Wed 24-Apr-13 11:15:39

A smaller place certainly sounds like the smart move. Yes, in 3 years the mortgage company will want their capital back and, if she hasn't got it, she'll have to sell up. Better to start the process now and voluntarily downsize in her own time than to get to 85 and be looking repossession in the eye.

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