Business & Investment

Mortgage Prisoners: Will Amendments Finally Provide an Escape?

This is about Money’s impact on three mortgage prisoners on their lives. Some are temporarily cheaper thanks to Covid-19, but it’s unclear when this temporary rest will end.

Claire Johnson from Sheffield, 57: Maximum interest paid 5.4%

Claire Johnson, depicted with her nephew, said she was worried about taking a 100% mortgage but was relieved by her financial adviser.

I rented this house 18 years ago with a Northern Rock Together mortgage.

I used to own a flat, but when I got married and had a daughter, it wasn’t ideal for small children.

An independent adviser who came to see me said: “This is what you want, a Together mortgage.”

I was a little worried-it was basically a 100% mortgage. I always worked as a legal secretary, so I couldn’t make a lot of money, but I managed to do it. But the adviser said I could afford it.

My husband helped me at first, but he left later that year.

I stayed home and had a hard time. Then, as Northern Rock went down, I received a letter from the door stating that my mortgage was in NRAM. I didn’t know who they were.

I really, really had a hard time. That’s the rate: I’m currently at 5.4 percent. When I think about what others are paying for, and what I’m paying for all the time … I don’t know how I’m not going down.

I was in debt: I was never in debt before that. I always had a good credit rating. It really upset me. I’m not negative equity right now, but I’ve been doing it for a long time.

You have just been planted there and you are stuck and unable to move, it is very difficult. It’s like wrapping a brick around your neck and jumping into the river.

I haven’t taken a vacation and haven’t been able to afford it since I first moved, so I haven’t decorated it. The only room I decorated was my daughter’s room. Because it was a balloon gum pink with a fairy, at which point she was a teenager.

It has had a big impact on my 21-year-old daughter. The reason I didn’t want to lose this house was because I didn’t want to disappoint her.

You go without everything-it was embarrassing at school because I didn’t have the money for travel and things.

Other kids may go to the cinema on the weekends, but we went to the library as her Friday treat. Such a little thing makes you feel like a second-class citizen-I shouldn’t have been there just because I’m in this situation.

My daughter is currently in college and is in her final year and will be in her first year.

I’m really proud of her, but I didn’t feel like a good mom because I couldn’t send her money. Had it not been for my mortgage, I would have been able to do it. I still have quite a few mental health problems due to it suffering.

Ideally, you should be able to lower or switch rates. If you can afford what we are paying for now and move to a new provider at a better rate, of course you can afford it.

Rachel Neil from Hinckley, Leicestershire, 42: Maximum pays 5.75%

My husband and I took out an interest-only Together mortgage loan with Northern Rock in 2006.

An independent adviser told me that this is one of the best products on the market and can be run on interest only for two years and then move on to a repayment mortgage.

It was suitable for us as we were about to get married, it was our first home and it released a little money.

At the end of 2008, we tried to switch to a repayment mortgage, but a crash occurred and everything changed. They told us that we no longer passed affordable prices and we had to stay in interest only.

Over the years, I became seriously ill with Crohn’s disease, and at some point I was hospitalized for about a year. It affected my husband’s business and we got into some arrears, but we caught up completely.

Our house has become completely unsuitable.It starts to make you really uncomfortable and pretty miserable

In 2016, the mortgage was sold from NRAM to Landmark and asked again if it could proceed to repay.

They said our interest rate was about 5.75 percent, so we simply couldn’t afford it.

They also said they would not be able to offer us other products because they did not have a loan license. We were really completely trapped.

Our home has become completely unsuitable, and it begins to make you feel really uncomfortable and quite miserable.

We have a two bedroom house and we have two boys. One is now 20 years old and the other is 13 years old.

They need their own room, but they still need to share it. Also, because they are mechanically fed daily, there are a large number of medical devices that need to be kept sterile. Everything needs to be kept in the bedroom, which is far from ideal.

My mortgage balance is exactly the same as when we started. I don’t want to think about how much I’ve paid in the last 15 years, and we haven’t paid any money since then.

The property has a capital of around £ 45,000, the credit file is perfectly fine and you won’t miss a payment for 10 years, but you still can’t get another mortgage.

You have eight or nine years left on your mortgage, but when you’re done, you’ll probably need to sell your property and move it to a rented property. I don’t want to get off the ladder of property, but I’ve come to the point where I’m forced to do so.

Our SVR caps personally save around £ 200 to £ 250 a month. This is because the price drops to about 2.1%. However, there are people in the UKMPAG group who can significantly reduce payments. £ 800 per month. It’s huge-it’s income.

Euan Sinclair from Northamptonshire, 59: Maximum pays 9%

Euan’s mortgages are in Kensington, which, unlike the others mentioned in this article, is an active lender and can offer new loans to some customers.

Yuan Sinclair says he can't repay, even though he has a higher than average credit rating

Yuan Sinclair says he can’t repay, even though he has a higher than average credit rating

My partner and I moved in 2000 after purchasing a 3-bedroom detached cottage in the village of Northamptonshire. We borrowed mortgages nationwide and undertook major renewals and refurbishments.

Unfortunately, in 2001, I became a self-employed driver because I became redundant with a high-paying job. Everything went well until the 2005 car accident broke my ankle and I was out of work for several months.

It wasn’t because of the accident, but I received minimal compensation for a loss of nearly £ 10,000 on my income. This meant that we were late for nationwide mortgage and credit card payments and were very close to getting back in early 2006.

We contacted the broker and received a “self-certified interest only” mortgage offer from Money Partners.

Shortly before signing the paperwork, I was informed that the independent valuation was below the expected loan-to-value. I was told that I had to pay a higher interest rate, but this wasn’t a problem as it had been “discounted” for five years.

We asked to confirm the valuation, but it didn’t arrive until we completed the mortgage because the time constraints on ownership forced us to do so.

As soon as it was completed, the mortgage was transferred to Kensington.

I didn’t think the property was valued correctly, but neither company is responsible.

We thought it would be only a few years, and if we repaired an incomplete credit history, we would repay the mortgage repayment with the mainstream lenders.

We all know what happened next-a financial crisis that none of us could control. More than 14 years later, I’m paying around £ 900 a month for 5% SVR and I’m not overdue or overdue.

The present value of our real estate is almost twice that of current loans, and I’m also significantly higher than the average credit rating, but it’s more reasonable because the affordable rating is very low. I cannot repay at a reasonable rate.

This will reduce your monthly payments to £ 350 and allow you to liquidate part of your loan without having to sell your house and move at some point.

For us, the SVR cap has the same effect as moving to a mainstream lender at a commercial rate. This is about 2 percent for us.

Mortgage Prisoners: Will Amendments Finally Provide an Escape? Mortgage Prisoners: Will Amendments Finally Provide an Escape?

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