Interest only mortgages are a great way to get into your next home. However, that doesn’t mean that you want to stay in them until the very end. You need to be thinking about your next move. Gone are the days where people kept mortgages until they were paid off. There’s really no way to pay off an interest only mortgage like that, because you’re never going to affect the principal with your mortgage payments. That type of mortgage that would change the principal balance is known as a capital and repayment mortgage.
Now then, what about your options? When time is running out, it can feel frustrating not to have remortgaging deals flying at you. But remortgaging really is the best way to handle this problem.
If remortgaging isn’t an option due to your age, you will want to switch over to making more than just the monthly payment. If you’re in a position to do that, then you’ll find that you’re going to be paying off your mortgage a lot faster than what would normally be expected. It’s just time to check out as much information as possible on your side of things. If you can, work with the mortgage that you have and see if you can remortgage at another time. Making all for your payments on time and even some before the due date will help get the attention for your lender.
If you have to, you should know that you can indeed sell your home. But since that’s the last thing that you want to do, you can also look into an equity release scheme that could work. This is for those 55 and older, but it’s never a bad thing to check it out through an adviser. They can give you more information that meets your needs because they will be able to ask you specific questions.
For the time being, it’s good that you’re looking into many options all at the same time. It’s possible to save your house if you’re going with an interest only deal, but you are going to have to act fast to avoid still owing on one house while living in another house.
Once you’ve been burned by an interest only mortgage, you might feel cheated. However, there are steps that you can take to avoid this problem occurring in the future. Make sure that you get professional advice on something this important. Good luck!