Does this financially ring true?

[ManyBooksLittleTime]

We bought our house nearly 20 years ago for 245k. Now, 19 years later, we still have 203k left on the mortgage. I know the first years is basically paying interest , but only 42k in 19 years??? We have had good interest rates too.Also, my husband reckons it will go down to 181k by August next year. Please can soneone more astute with finance let me know if these numbers can be right?

This sounds extremely dodgy. I'd be getting everything in writing, all statements and records and going over them yourself with independent help eg a forensic accountant or financial advisor.

Sorry but I'd be removing the husband from this conversation for now until I'd got to the bottom of things.

Nothing adds up here. If you or your husband borrowed more against the mortgage, surely the borrowing period and repayment amounts would have been reviewed each time and a new statement produced. No way are you currently “overpaying” at £1.9k on a £203k repayment mortgage over 8 years. You are massively underpaying. If that is the repayment amount then the period must be much longer than 8 years. If he is secretly paying off a huge chunk in addition each month (to hide the fact he borrow ~£100k without your knowledge) then it might be plausible. The bank won’t lend unless the repayments over the term (8 years) will clear the debt.

I think your husband is lying to you.

Also, his comments about “paying the difference” between the purchase price and the value including interest makes it sound like it has been an interest only mortgage from the start. What was your deposit? Did the deposit take the outstanding initial debt down to £203K??
He would have to have ALSO taken out some sort of method to repay the bricks at the end of the interest only term. Otherwise, in effect, you will have been renting for 19 years and in another 8 years the bank will take back the house.

Your husband is lying to you. You’ve either borrowed lots more. Or you have gone onto interest only for long periods.

We had a mortgage for 515K 7 years ago. 25 year mortgage. Our balance is 375 k now.

hope he can remember how much we borrowed.

If he can't remember, "can't remember" or even if he apparently can, the best thing to do is to check the paperwork. If you can't find it he can request replacement documentation from the provider(s). If you are also on those mortgages you can yourself without his permission.

You need to have a tough talk with your husband about finances and how from now on today you are going to be fully involved. Maybe you have just been letting him get on with it and he's not very good with figures and thinks that you agreed and completely understood each time you borrowed more what the consequences were in which case that is your mistake for not taking joint responsibility and perhaps being too trusting in which case you need to tell him your concerns without blaming him alone. But maybe he is financially abusing you by making it difficult for you to know what is going on while he controls the money however poorly. I don't know. Deep down you will know. Are there any other red flags in his behaviour other than a potential financial mess looming? How he responds to this conversation will be very telling.

You've not only paid back 42k, you've borrowed more on more than 1 occasion. You aren't going to see the amount you owe go down massively if you keep adding to the debt! How much have you actually borrowed in total?

I agree with @Pheefifofuckthisshit that perhaps you need to get to the bottom of this with an accountant or IFA first. Depends on what you know about your relationship and how things tend to go. And whether you are on the mortgage and can get your own copies or not.

I was going to say anyway OP, more generally, that I suggest you check your credit file as a matter of urgency. Because even if you are not on this mortgage if you are linked financially in any way ie you have a joint account or joint bill then this and any other debts he has could be causing you problems. And if you are on this mortgage then his trouble is yours too in terms of being personally responsible for this very large debt. Although it is anyway considering you live there and contribute but in a different sense.

Also OP you can talk to an IFA or Citizen's Advice or Debt Service (a charitable one, not a for-profit one) at any time regarding your own situation and I think you should. Likewise a solicitor. You don't need his permission or to take him along or to tell him. There is also a lot of financial education information on websites such as Which? and MoneySavingExpert and ThisIsMoney (from the Daily Mail - yes, I know, but it's good) so it would be a good idea to educate yourself about finances more generally as knowledge is power.

Plus turning unsecured debt to a secured debt is always best avoided if possible.

You may need to think more radically like downsizing. Hopefully you have decent equity

Highly unlikely, from what she's said.

I suspect the only reason DH has opened a discussion on their debt, is because of the lenders intention to foreclose and sell the house. That is the ONLY feasible option to repay the outstanding loan.

Can you imagine thinking you’re paying Your 245k mortgage off for twenty years and then finding out you still owe 203k ? And not even knowing if it’s right?

it is astonishing how some folks live.

Even adding 7 grand to your mortgage to pay off credit card debt shows a complete inability to manage money and an issue with debt.

I suspect op the debt was higher than you know and you have been paying interest only for a long time.

This is an ignorant comment. London prices only took two years to recover after the crash in 2008. Durham and Hartlepool only recovered to pre-2008 prices in January of this year, meaning that someone who bought at the top of the market in 2007 in Hartlepool has had to wait all this time for the value of their house to return to what they paid for it (just in time for it all to crash again).

www.standard.co.uk/homesandproperty/property-news/house-prices-durham-hartlepool-pre-2008-north-south-property-uk-b976592.html

I can't see how he's lied?
OP has buried her head in the sand (and would have continued to do so if she hadn't been sent a letter).
I wonder how much knowledge she has of their finances in general? Does she know if they are living to their means, for example? Putting credit card debt onto a mortgage is generally a bad idea (although not so bad if interest rate was below 1%) for example, and they (both) did something to create it.

She admits to agreeing to the original mortgage and to the re-mortgages (she can't even remember how many). I suspect at one of these points (or maybe even the original mortgage) they switched to interest only. As she seems perfectly happy for her husband to deal with this stuff, he might have switched without her knowing. Or he may even have discussed it with her as she seems vague and unsure about other details. None of this "clearly" suggests lying.

Amazing you have been so passive about this OP.

It has been in the past, and still is quite common for one person to take the lead in finances and the other person to find out too late that they have been too trusting or passive about family finances. Especially when being influenced by a partner who really doesn't want you to be interested for their own reasons and especially if you are also not confident with money or maths. At the time it can feel like a fair division of labour if the 'non-finances' partner plays to their strengths in other ways.

Don't beat her when she's down.

Yes this is a warning to others not to get to this point but OP needs help what to do next and moral support should she suffer any great shocks when she gets to the bottom of it.

You need to see the statements urgently. This sounds very ominous.

@uiyo7978
And where other than London would you have bought a house for 245k back in 2002.

What ridiculous naivety. The answer is, any desirable/affluent area in Scotland or the North of England; and I'm talking family detached, not castles.

OP is in this mess after 20 years of ignorance. Please don't mislead her. further.

We've paid off £50k in 6 years so something is definitely not right.

@uiyo7987 It doesnt add up but on the other hand if you had a house that cost that much 20 years ago, it would be at least 1million now....so it's not all bad.

No it wouldn't. Depends where in the country it is. You do realise the housing market moves differntly in other parts of the country?

@uiyo7987 And where other than London would you have bought a house for 245k back in 2002

Is this a joke? What a ridiculous comment. I bought a house for more than that then, in North Wales. 4 bed detached.

You're having a howler with your contributions in this thread.

And where other than London would you have bought a house for 245k back in 2002.

PILs' 4-bed family house in need of a bit of work in a nice part of rural North Wales cost £245,000 in 2002. Then as now the stamp duty threshold was £250k but because your money went further there was a lot of bunching in the market around £240-250k for a family home in many affluent areas.

Does anyone know what “the company” is that OP refers to - seems as if “they” have an overview of mortgages? 🤔

there is something wrong here, the calculations are not correct

I can find a calculator that does 30 year loan, so slightly different....but close

If you are on year 19 then you should have paid £110k of principal loan (over 27 years this would be slightly more) Interest at 5% £183k, loan balance £125k

www.bankrate.com/mortgages/amortization-calculator/

I did the loan start day as October 2003 to keep it simply 19 years ago - have a play and ignore the $ sign as it makes no difference.

www.calculator.net/mortgage-calculator-uk.html?chouseprice=245000&cdownpayment=0&cloanterm=27&cinterestrate=5&cpropertytaxes=0&chomeins=0&cpmi=0&cothercost=0&cstartmonth=10&cstartyear=2003&printit=0&x=64&y=15#ukmortgage

this calculator - input the figures and then scroll down to the table that shows you all the figures for each and every year - this one is £108.961 with a 27 year loan at 5% borrowing 245k with no deposit

My point about house prices is that rather than try and pay all of this off - i.e. quite a large mortgage at a time when interest rates are rising and now they've hit middle age is perhaps to downsize. I mean yes they can spend the next 10/20 years paying 2000 plus on the house and be stressed about. Or they can just downsize. That wasnt simply a comment on house prices but also on a way out of the problem without having to spend all their spare cash on paying off the house in their latter years

I suspect she means their mortgage broker.
If the same one has been used all along they may be able to be very helpful in unpicking this, so long as they themselves have not been negligent of course.

Are you able to use Excel?

It's very easy to work out mortgage interest and capital repayment with a simple Excel function.

Use the PMT function

For example
=PMT(3%/12, 120,100000,1)
gives you the monthly payment required to pay off a 100k debt, over 10 years, at 3% interest, assuming monthly payments (12 per year, 120 in total over 10 years)

Set up your worksheet so you can play around with the interest rate, number of years to pay off, etc. Once you get comfortable with the basics you can add in effects of overpayments etc.

You do need to be all over this, to be honest. It sounds like you have increased the debt capital rather than reducing it over the many years.

Something has gone on. We had a mortgage of about £185K over 20 years and after 13 years there was £65Kish left on it to pay off. So you should have paid off a lot more than you have. It does look like there have been extra borrowings but why do you not know about them, you must have had to sign for it. Or is it only in your DH's name?