Reducing my mortgage payments

Posted on 26 January 2011 by Roger

I have been speaking to my mortgage lender about a short term proposal for reducing my mortgage repayments. He says they are not allowed to do variations of mortgage or extend the repayments but there is something else they can do if we ask. But they won't tell us what it is! any suggestions?


How very strange, how on earth do they expect you to know what to ask? There are various ways to reduce your payments, but as far as I can see they all involve a variation of your mortgage:

Transfer from a capital and interest mortgage to an interest only mortgage.

Take a payment holiday and allow the interest to roll up.

Make underpayments by utilising any previous overpayments you have made.

Extend the mortgage term if you are on a repayment mortgage.

Transfer to a product with a lower interest rate.

Borrow more money and use this to subsidise your payments.

Your Lender has a duty to deal fairly with any customer in financial difficulties and in accordance with the FSA Mortgage Code of Conduct they must consider whether it is appropriate to do one or more of the following with your agreement:

a) extend the mortgage term

b) change it's type

c) defer payment of interest due

d) treat the payment shortfall as if it was part of the original amount provided

e) make use of any Government forbearance initiatives in which they choose to participate.

I recommend you speak to your Lender again and remind them of their responsibilities. A threat to report them to the Financial Ombudsman's Service for not treating you fairly could well make them come to their senses.

If this fails recommend that you then speak to Citizens Advice Bureau and take their expert assistance.


Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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