Help me with structuring things please

[Ourdearoldqueen]

I’m trying to get my head around What To Do.

My fixed rate on my mortgage is running out and rockets to 8% so time is of the essence.

situation:
Aged 53, single parent, income from all sources (DLA/CMS/CB/salary) is £4700 net

Good pension arrangements and job is as solid as it could possibly ever be.

House is in just my name and is worth £700k
current mortgage is £185k

i also have a bill I need to pay over the next 12 months for 18k.

options (not exhaustive)

1. Put the £18k on a loan and remortgage for same amount on repayment basis

2. remortgage £185k interest only with a fixed rate and then renegotiate when the fixed rate is up, lowering my monthly outgoings and paying the £18k from income

3. remortgage for £203k repayment

All other ideas options welcomed. Don’t want to sell the house.
cheers all!

To start - what are your outgoings? and when does the rate rise kick in, and what will that add to it?

Outgoings - mortgage is £1300 and will rise to £1700

Utilities, CT, £500/mth

other expenditure - groceries and ents and clothing, kids hobbies etc another £900/mth

savings £400/mth (in addition to pension which comes off top line)

Insurance - house and car - £200

fuel, car tax £350

kids’ tutors £150

Car is paid for. No other debt or finance etc

See a mortgage adviser. Your income is good, as is your LTV but a lot of lenders get twitchy about anything that's not salary that might restrict your options.

Another route would be to see what deals your existing lender offers, which might save you from income and affordability checks.

What savings do you have given you have a reasonably high income? Could some or all of that go towards your £18k bill? If you put this on the mortgage, you're at risk of turning it into long term secured debt, which is expensive - £18k paid back over 15 years at 5% will cost over £25k to pay back. You could include it in the mortgage to simplify things, but then you should really vow to over pay, to get the mortgage down faster.

Do you plan to retire any time soon or start to take money out of your pension, which I think you'll be able to do once you're 55, although you should probably take advice as to whether it's a good idea to do that or not.

So a medium term goal would be to pay off your mortgage by the time you retire? But also need to consider whether DC expect to go to university and what money you'll be expected to contribute to this.