Byline: MARTIN LEWIS The money saving expert answers your questions
Q My 15-year interest-only mortgage finishes in March. I can't raise enough equity to pay off the amount owed. What are my alternatives? The property is worth PS150,000, my mortgage balance is PS66,000. Cherries.
Martin says: This isn't easy. It's one of the reasons interest-only mortgages have become very rare, as many people have ended up in this undesirable scenario.
The most obvious option is to sell the house. Then you'd come out with clear cash.
If you don't want to do that, talk to your lender about extending the mortgage life. And talk to a good mortgage broker to see if anyone else will give you a better deal.
Either way, they'll almost certainly want you to switch to a repayment mortgage - where you repay the actual debt as well as paying the interest.
This will mean bigger monthly repayments, but at least you'll be set to clear the borrowing.
There's also a chance you might fall foul of either age restrictions or affordability tests.
If that's the case, you should speak to Citizens Advice - see citizensadvice.org.uk - for further options, though the likelihood is you may then need to sell.
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|Title Annotation:||News; Opinion; Columns|
|Publication:||Sunday Mirror (London, England)|
|Date:||Sep 11, 2016|
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