My incomplete mortgage jigsaw
The Times - 10 November 2007
Mark Atherton helps an agricultural researcher who faces a worrying deficit on her home loan
SARAH COOK enjoys an attractive rural lifestyle. She lives in a £250,000 three-bedroom house in a Cambridgeshire village with her 11-year-old son and works in agricultural research. However, two financial concerns are encroaching on this idyll.
The main worry is that Sarah has no way of paying off all the capital on the interest-only part of her mortgage. “I don’t know whether I should increase my monthly payments or use some of my savings to reduce the deficit,” she says.
Sarah’s other concern is her pension provision. She says: “I moved from a final-salary scheme four years ago and I am unsure if the contributions to my current company pension will amount to an adequate retirement sum.”
The 47-year-old earns £27,000 a year and has a £65,000 mortgage with Alliance & Leicester. “It is split into two parts,” she says. “There is a £17,000 repayment mortgage and a £48,000 interest-only mortgage. Both are at an interest rate of 6.09 per cent and have 13 years to run.”
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Sophie Stewart - London
