I have read an article about the impact of maturing interest only mortgages and how it will affect aging customers.
The FCA estimate that 1.8 million homes in the UK are on Interest Only mortgages and that excludes the Buy to Let market. Many of these do not have a repayment vehicle in place.
These mortgages where set up prior to 2008 in most cases and the customers that have this type of mortgage will be coming close to retirement when they mature.
The changes in mortgage regulation, as it pertains to customers age, has been shorten greatly over the years with most lenders insisting that the mortgage be paid off by age 75.
You can read the article here
If you are one of these customers what practical steps can you do???
Well here is a list
1) Contact your mortgage broker.
2) Call your bank and start repaying the capital every month.
Those on deals can pay 10% to their mortgage without a penalty in most cases.
3) If you are in your 50’s, re-mortgaging now over a 20-year term as a repayment loan.
4) If your loan is small but your house is of considerable value you may qualify for a life
time interest only mortgage.
5) Move home and down size.
Unfortunately, this does not give a lot of option and it will not fit a lot of people needs but until regulation opens this and maybe a few other possibilities, is all we have.
It is crap, believe me I know and I could do a whole rage page on the subject but if you need help please give us a call and maybe we can find a practical solution to your individual situation.