Thank you. I don't know when you became aware of the possibility of a shortfall
but 15 years ago you agreed to repay the
interest only part of the mortgage in another 15 years. That time is now.
You are therefore in breach of your mortgage terms and conditions by not
doing so. In fact, you are actually quite lucky because they do not have to add
the interest only some to the capital and interest payment, they can simply sue
you for the shortfall and if necessary, make an application to court for
possession of the property.
There are many borrowers in a worse situation than you which have 100%
interest only mortgages and although some lenders have agreed to extend the
period of interest only in order for the borrowers to try to refinance, many of
them are not able to do so and are threatened with legal proceedings.
To answer your question, they are only allowed to add the interest only
part onto the capital and interest part of the mortgage conditions allow for
it. However if they are not allowed to do that and they have done it, I can
tell you that they will be under no obligation to extend the period of interest
only and they would be looking for immediate repayment of that.
On these facts, I am afraid this is one of those that I would not be making
too much noise about otherwise, they will simply press you extremely hard for
The only way out of this is to explore the possibility of refinancing with
another lender which may agree to do part interest part capital repayment but,
you are going to have to find a repayment vehicle to repay the interest only
The final solution which is probably not what you want is to simply sell
I wish I could give you better news and I appreciate that this is not the
answer you wanted but there is no point in me misleading you.
can I help further?
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