Why has our bank changed our mortgage to a ONE YEAR LOAN?
I have owned a business with my sister that has folded thanks to the lousy economy. It’s now for sale. Both she and I had gotten other jobs to pay the mortgage on our building, but we still asked the bank if there was a way to lower the mortgage payment until the building sold.
The bank agreed to lower it to an interest-only monthly loan, but they want our 20 year loan to now be a ONE YEAR LOAN, and we would owe the entire principal in a year!! Huh??
She and I can pay our mortgage payment until the building sells, but what if it doesn’t sell in a year?? We can’t come up with the entire principal!! Why are they doing that?? The bank loan officer said I could then reapply…but there’s no guarantees. They act like they WANT the building!!
Does this all sound reasonable and normal??
By the way, no I have not signed the new contract. It’s by reading it that I’m asking this question here.
And, I’m not sure I can go back to the 20 year? When I asked about it, he said since I’m not making income in the building, they would have “caught that eventually anyway” and would have had to retalk to us. He was very vague! If I’m making my payment every month, in spite of not using the building to do it, WHY would they have to “talk” to us?
I also find it WEIRD that they would only give us this new interest-only arrangement for one year! Why not two years so I can get the building sold??
Something doesn’t feel right about all this.
A question below was asked about tenants. My sister and I have been very willing to have tenants, but the three that have inquired have only wanted to rent the building for MUCH less than our mortgage. It’s been appalling. But…we know we may have to do that just to get some of our mortgage paid. Sad.