Is it possible to change from an endowment mortgage?

[Norwester]

HI,

Ive 10 years left on an edowment mortgage, despite everything thats happened to the market, Im not overly concerned about being able to pay off the mortgage (mainly due to the initiial house price).
I was hoping to do some relatively lareg home improvements 65-70k on the house and was hoping to remortgage the whole lot into one package, is this possible?
I have one other loan (15k) I would also love to incorporate, Im s/e and think I should just be able to see out the next few years with my wife but would love to consolidate all these debts and create some real stability.

Any advice would be greatly appreciated, Its the only mortgage Ive ever had so Im not the most knowledgeable on mortgages etc.

Thanks
NW

 

[mercman]

I suppose the initial question is as to why you took out an endowment mortgage in the first instance ? I'm no expert in mortgages but I would feel that the repayments you have made have in the main been paying the endowment rather than paying off the principal amount. As the endowment is linked to the equity markets, I would say this is not the best time to cancel. Would you not be better off waiting to see if the equity markets recover somewhat ?? You will have to get a valuation on the endowment to check its valuation at present. Endowments were pushed previously as they were big commission earners for the sales people that sold them.

 

[LDFerguson]

It is possible to convert your loan into a capital-and-interest mortgage and borrow extra for the purposes you mention, but only if your documented income supports the total loan and there's enough equity in your home.

As mercman says, it may not be the best time to cash in your endowment policy - this requires investigation. Your options are (a) to keep paying it to maturity alonside your new mortgage, (b) to cash it in now and reduce the amount you need to borrow or (c) to make it paid-up, i.e. stop payments but don't cash it in at this time.