So what happens if you CAN'T pay the repayment part of your mortgage in this situation?

[LaurieFairyCake]

Citizens advice website says the lender is obliged to consider options if you can't pay - like shifting to interest only

A year ago we asked our lender to shift to interest only as there's enough equity to sell off our flat and pay off our second home (where we want to retire to)

They said no as we have to earn £150,000 a year to do that

Now we HAVE been allowed as the government has forced them to do it for 6 months

We want to keep that going and just pay interest only until we retire in 10 years, sell our flat and pay off our second home

Are they likely to let us?

(My health means that trying to do two jobs is too much for me and at some point I'm going to burn out and HAVE to shift into one job. We can't go and live in our second home and give up work as we're too young)

There are penalties if we sell within 5 years - prohibitive ones

Added to which if anywhere has fallen in value that area has - probably a terrible idea.

Is it one of your dc in the btl so you can't increase the rent?

Honestly just contact your current lender and do a product switch
There are no affordability checks and it is so straight forward. Don't stay on variable rate as you don't need to. You might not be able to remortgage to a different lender but you can stay with your current lender. It's a five minute job

Someone suggested earlier selling and moving to my retirement place and getting a job there

There are very few, if any jobs. And my very elderly aunt is in my retirement place - she will be dead in 10 years which is why I want to retire there then

They might lend us £130-£150

Can you buy something then for 550k, selling you current house? You clearly don't want to do this but I don't know what else to suggest unless you can rapidly increase your income.

The last time I contacted my lender I waited 90 minutes in a queue and in five minutes they said they weren't doing mortgages right now

Maybe it's different 6 months later 😂

Good luck

You're right there's loads of reasons I don't want to sell - the stress (I've got 2 jobs right now, DH is too sick to pack boxes), I don't have the removal costs and stamp duty money, the kids, the arranging the new mortgage, selling BOTH places...and coordinating that with buying

It's all too much

Fingers crossed you'll be forced to sell your other property now. One less greedy landlord in the market is a win for everybody.

@LaurieFairyCake do you have an online account for your mortgage? I remortgaged in December, did it all online, they didn’t do any affordability checks and all the options were there on the screen for me to choose from! (And I have an interest only mortgage which we’ve had since 2005. I swapped to another interest only but fixed rate, we’d previously always been on a tracker) This is with Barclays.

Such a shame your comprehension skills are so poor, clearly you've not read the thread - if you had you would see that this greedy landlord lets it to a family member at no profit to give her security of somewhere to live.

Thank you to so many people for the lovely private messages 🥰

No online account Lizzie (unfortunately), so glad yours was easier

Can you not set one up? Which bank is it with?

I'm sorry OP - but I think you made a poor decision wrt the BTL property. Not having a go, just stating a fact. Given that, you now need to make hard decisions around.

• Increasing your income
• Selling your current place and downsizing; or moving to a cheaper area; or both.
• Taking a hit on selling the btl to free up a small amount of cash. (Or plan to when the 5 years is up)
• re letting your BTL to someone on a commercial rent.
• Re-mortgaging.
• moving jobs to support any of the above decisions

Doing nothing now will only increase your problems.

Unfortunately this is the reality of the country coming out of a stupidly low interest rate period held for far too long, which has driven debt to unmanageable levels for many people.

When we decided to buy it DH wasn't ill and no one expected someone so young and fit to get so ill

yes

I can't do any of those options apart from re-mortgage (if we're allowed)

The commercial rent for my BTL might be an extra £200 - but I would never do that to my family member

The trouble is that actually you could do some if those things but you are choosing not to.
If it comes to risk of repossession you might see things differently.

no one expected someone so young and fit to get so ill

No one expects it, my sil got ill over lockdown. We assumed Covid but it wasn't & in the early days didn't know if she would survive. I've never known her to be ill. One of my healthiest colleagues dropped dead at 51 & my 32 yr old neighbour has just been diagnosed with breast cancer. It happens unfortunately

I agree with others that you are saying ‘can’t’ when you mean ‘don’t want to’. Surely if you have £300k equity you could sell the London (i assume) property and move up north, buy a house outright with a bit of change and then pretty much any job would give you at least a basic standard of living with no housing costs?

It does sound hard, but you have options. A lot more than most. ‘A cheap terrace’ is the only housing option for many many people, whether rented or stretching themselves to buy where house prices have come so far out of line with wages for people under 40.

You don’t have to move up North. You could buy a nice flat in commuting distance to London for £300k. No mortgage, no stress.

You are in a tight spot. Your health and finances are not what they were when you bought the properties & took out financial products, and your future is not what you had planned and dreamed of. You have my sympathy for all that.

However, you cannot afford what you cannot afford - and wishing otherwise has no impact on the situation. I understand you are suggesting 'deferring' paying off the mortgage(s), but to a bank that is all 'red flags' about if someone will have real issues of paying even the interest only over the next 10 years. They do not see it as 'we have our profit, so what' - statistics probably show that more people on interest only default on mortgages. At the very least, and sorry to be grotesque, the bank is wondering will your DH be able to work at all or even be around in a few years time?

You have way more options than you think you do. You have equity that is far higher than the average house price in the UK (currently just under £300k). You have two properties, one with equity and income, one with significant equity and high value.

At the very least, your family need to pay market rate on the BTL.

What you cannot do is bury your head and 'hope' that you can cling onto current jobs, current location, two houses and the equity you have built. Your planned future is not going to happen as you hoped. It is not your fault, but it is your responsibility to make a hard decision.

I think you need to speak to a broker and look at both the mortgages - and be prepared to swallow a bitter pill of disappointment.

I say this as someone who is currently helping some of my family who are in a similar situation - health = wife cannot work and has limited life left. The family are moving to cheaper house, paying off mortgage, and generally 'cutting their cloth' having only one earner to support their future.

IFWH

You're quite right (and is good dark humour) - at some point when I'm under threat of repossession I will have to !

Dibblydopdah - that may be good. If you can see any £300k 2 beds in commuting distance of west London that would be great 🙏

Haven’t rtwt but we’re doing this (paying IO on two mortgages) and have been for years. Two properties, one rented out. Lender lets us because both mortgages are with them and the LTVs are very low. We arranged it all through a broker when we bought the second property (and retained the first one to rent out). Happy to recommend him if you pm me.