Mortgage lender seeking repayment as lender reaches 58?

[Mr Squarekins]

A relative mentioned this week that she'd been 'called in' for a meeting with her mortgage lender, a high st building society to ask about what her plans are to repay her mortgage. She turned 58 in the past few weeks.

Is this likely to be true? She reckoned that they proposed that she take some funds from her savings account with the same society to pay a chunk off.

Never heard if this before. Likely to be true or rubbish?

[rix]

Interest only?

[scot_aln]

or does the current term go beyond state pension entitlement?

[Alex Z]

If the term of the mortgage and amount outstanding would take her past retirement age, it feels fairly sensible that the bank has this discussion.

[AlexC1981]

Alex Z said:

If the term of the mortgage and amount outstanding would take her past retirement age, it feels fairly sensible that the bank has this discussion.

More sensible to have had the discussion when she applied for the mortgage.

[Sheepshanks]

Mr Squarekins said:

Likely to be true or rubbish?

Why might she might have made it up?

[Ziplobb]

as an ex HSBC employee who used to sell mortgages this is an entirely reasonably request particularly if its coming to the end of term, is interest only and on looking back at the account history there have been no reductions in capital. Normally contact will have been made by letter over a period of time to establish the above.

[Douglas Quaid]

She’s your relative, only you know if she’s a liar or not, none of us know her.

[Jamescrs]

Seems a reasonable request depending on how the relative has structured the mortgage,

I think there are a lot of people on interest only without a plan for repayment.

[Simpo Two]

Jamescrs said:

I think there are a lot of people on interest only without a plan for repayment.

That seems a bit careless of the lenders.

[Mr E]

Simpo Two said:

That seems a bit careless of the lenders.

They have a loan secured against an asset that is likely worth significantly more than the money owed. Zero risk other than reputational “bank repossesses grannies house” headlines in the daily mail

[Simpo Two]

Mr E said:

They have a loan secured against an asset that is likely worth significantly more than the money owed. Zero risk other than reputational bank repossesses grannies house headlines in the daily mail

If the asset is their house they're a bit buggered. Equity release then... and no doubt the lender has the salesman lined up...

[Jamescrs]

Simpo Two said:

That seems a bit careless of the lenders.

Whilst I agree since when has that ever stopped them

[ChocolateFrog]

Mr E said:

Simpo Two said:

That seems a bit careless of the lenders.

They have a loan secured against an asset that is likely worth significantly more than the money owed. Zero risk other than reputational bank repossesses grannies house headlines in the daily mail

That doesn't seem zero risk to me.

[Agent57]

"How is this debt going to be repaid?" should be a question every lender asks at regular intervals.

"How am I going to repay this debt?" should be a question every borrower asks.

Sadly too many people are not asking these questions.

[Killer2005]

Simpo Two said:

Jamescrs said:

I think there are a lot of people on interest only without a plan for repayment.

That seems a bit careless of the lenders.

Depends on what the OPs relative told the lender when they took out the mortgage.

[OIC]

"Downsizing" usually makes the bank go away.

Whether or not that's what happens is a bit more complicated without the use of a time machine.

Man plans and God laughs etc.

But at least the letters stop for a bit.

The whole 'not counting pension income as income for a mortgage' is a bit silly when it's an allowance, DB pension or annuity.

OTOH 2008 anyone?

[okgo]

Agent57 said:

"How is this debt going to be repaid?" should be a question every lender asks at regular intervals.

"How am I going to repay this debt?" should be a question every borrower asks.

Sadly too many people are not asking these questions.

As someone with an interest only mortgage. That hasn’t happened. “I’ll sell it” sufficed

[Simpo Two]

okgo said:

As someone with an interest only mortgage. That hasn t happened. I ll sell it sufficed

I thought the idea of an interest-only mortgage was that you paid into an endowment policy which would later 'be worth more than the value of the mortgage leaving you a profit' as the IFA said who sold mine to me. And as we know even that idea went tits up.

I suspect a lot of people are quite happy living in debt. It means they can have more stuff, they just repay the minimum and don't worry about the rest. Everything is just £X per month.

[98elise]

Killer2005 said:

Simpo Two said:

Jamescrs said:

I think there are a lot of people on interest only without a plan for repayment.

That seems a bit careless of the lenders.

Depends on what the OPs relative told the lender when they took out the mortgage.

This. I've taken loads of mortgages and they ask.

Its not unreasonable that they ask again when its nearing the end of the term if there is a big outstanding debt. Mine also send me a reminder every year that it's only IO and the debt remains outstanding.

If nothing else it gives the home owner some time to plan rather than just getting a notice at the end of the mortgage.