To think it's madness that I can't covert an interest only mortgage to a repayment without an affordability assessment

[ReallyTired]

We have an interest only mortgage, it's tiny and I phoned up the mortgage provider to ask how the repayments would be to change it to repayment. I feel worried that we will have find a huge sum of money in 18 years time. I have been told that need to go through a mortgage advisor to do this.

We can make repayments whenever we like as we are out of the fixed period. I don't understand why the building society cannot simply give us a figure of the amount we need to pay off each month. I don't want to be solely reliant on an investment vehicle.

I suppose it's because you are taking out a new mortgage product so have to do all the paperwork that goes along with it

Can't you just overpay every month?

Can you not work it out using a mortgage calculator like this one?www.moneysavingexpert.com/mortgages/mortgage-overpayment-calculator
I had a part repayment part interest mortgage, and just overpaid as much as I could afford until it was paid. I never bothered changing anything.

It's because they have to advise you to get independent advice.

Have your tried the mortgage info and calculators on moneysavingexpert? You might find some info that helps you decide how to work it out.

www.moneysavingexpert.com/mortgages/

Or just go and see a broker and see what they say.

My sister had the same problem. It's not Santander by any chance is it?

Anyway, she can't recommend London and Country mortgage brokers enough, if you decide you want to switch mortgages. They're recommended by Martin Lewis as well.

They don't charge the customer and she managed to switch mortgages to Halifax in less than 8 weeks.

She ended up with a much better deal than if she had gone to repayment, with her original provider.

As above, just overpay. That way you have the freedom to vary payments throughout the year to match spending habits (e.g. Reduce payments in lead up to Christmas, but increase during other months). It beautifully allows you to control your budget properly.

There are online calculators you can use to work out what your payment should be. For instance, if you had £125,000 mortgage left over 18 years you'd have to pay roughly £720 per month (at 2%).

Thanks for the links. It is Santander. We got our first mortgage 14 years ago so we have a very good rate. I think I will stay with Santander and just over pay by the amount suggested by the calculator.

They have an obligation to do this under the Mortgage Credit Directive.

What happens if you agree to repay £500 a month more than you are now, and can't afford it and fall behind? If they just set everyone to a higher payment amount without doing any sort of checks that would happen a lot?

We had loads of income checks when we first took out the mortgage. Our income had gone up and interest rates have plummeted. It's daft having to pay to go through affordability checks again.

What pisses me off is that we were sold a lifestyle tracker product which supposedly had the flexibility to extend the term, overpay etc. Santander have been as difficult as possible. I don't want a new mortgage I want to overpay to reduce the debt.

Yabu, financial regulations have tightened up massively in the last decade, with lots of emphasis on affordability and avoiding the mis-selling problems that came up for Endowments, PPI and will probably come up for interest-only mortagages in the next decade.

Thems the rules. If its with the same mortgage company it might not be so bad.

Presumably there was a good reason for you taking an interest only mortgage a few years ago. The lender needs to know what's changed.

They can't just give you a figure, they will need to go through all your incomings and outgoings to see what you can pay.
It would be unfair for on you if you just said you could afford to pay a certain increased amount one month, only for months later you be unable to stick to it.

Just overpay, it makes little difference really, if you don't have penalties to overpay.

If you can just overpay without penalty (it might be up to a certain percentage of the loan amount per year, worth checking) then do that or speak to a broker.

Yep, as others have said just over pay.

It is what I do (also interest only mortgage). I worked out what the repayments would be if it wasn't interest only & just pay that instead.

Santander tend to let you over pay 10% of the balance on your mortgage.

We are long out of the intial period with santander and have made over payments every year. I wanted to know the balance we need to pay off. Santandar have some of the worst customer service.