Mortgage reserve due

[Haroon]

I hope someone can provide some assistance. I took a mortgage through Barclays which had a mortgage reserve account where I can access money. I dipped into it and now have found myself with using just over £37k and have paid off my mortgage. My mortgage should have gone till 2022 by with the offset it has been paid off. That means I have to pay the £37k now. I really don’t want to remortgage for 2 reasons.

1. I am 49 and I would rather wait until I’m 55 and pay it off with a lump sum from my pension. I would gladly make regular payments into the mortgage reserve until then as I don’t have the mortgage to pay itself.

2. My wife has had an issue with her health and I have just put in a claim which will pay out £50k. Although I am sure this will pay you can never guarantee this until they actually pay and this can take a couple of months.

Barclays advised me to take out a remortgage but I really don’t want to get into another mortgage even though I could pay this off when I’m 55, also this would incur early repayment fees.

Really would appreciate if someone can help as I need this sorting in next couple of weeks.

Thanks in advance.

[February17]

We once had a Woolwich account which was as you describe, Barclays bought out Woolwich if I remember correctly and we eventually ended up with similar problem of dipping into the 'reserve'.

We eventually remortgaged onto a really low interest repayment mortgage which I am chipping away at.

1. You are in a good position if at 49 the debt is only 37K and you will get a reasonable pension 55.

2. Sorry to hear about your wife's health problem.

I would remortgage on a short term of maybe 10 years and see what happens when you get your pension. In 6 years you may have different ideas and priorities.

If your wife's health insurance pays out 50K then look at debt again then. Your priority might have changed and maybe spend the money on your wife and living a good life rather than clearing the debt quickly.

Remember that the debt is secured on your house so you pay the bank or things get much worse.

I would ask at Barclays and see what they can do for a short term low interest rate mortgage. or maybe longer term so you have more spare funds each month and pay it off later.

Don't delay and risk a bad credit score for late paying the debt, get on with it this weekend as it looks simple really.

[Haroon]

I have started the process of remortgaging. What I was hoping to do was pay into the mortgage reserve every month just like you do with a remortgage until the time comes when I can pay it off in full which at an absolute max would be 6 years but I don’t think I have that option.