Remortgagers in negative equity get advice

Date:Thursday 5th March 2009
Author: Rachel Fletcher

A couple who are in negative equity have been warned that they may not be able to find a new lender when their current mortgage expires.

Writing in the Guardian, Virginia Wallis told the couple that they ought to be able to obtain a new fixed-rate deal from their current lender when their mortgage expires in March next year, as a new valuation would probably not be necessary.

But she advised them to try to save for the new loan in the meantime.

The couple have a 100 per cent fixed-rate mortgage for £123,250, which they took out in July 2007.

But their home is now worth only around £115,000.

Ms Wallis explained that they should begin to consider new fixed-rate deals three months before their current one expires, though they may not be able to find another lender since their home is worth less than their mortgage.

Meanwhile, Michael Dowling of the Independent Mortgage Advisers Federation has told the Irish Times that people who gamble online may be rejected for mortgages.

He said that while it would not necessarily mean being disqualified, banks are "looking for any excuses" not to lend.