Hello everyone,
I recently finished work due to ill health. I’m on sick pay until October and then i’m unemployed and drawing my pension.
I’ve been told that by law I need to inform my mortgage provider that i’m unemployed, at which point they put me on a higher rate. I’ve just started a 5 year deal with Nationwide.
Please can someone tell me if this is correct?
Hi James,
If I was you, I’d be careful about everything you said to Nationwide when arranging the new deal. They may ask about your timeline. E.g. Were you already in discussions about the new mortgage when you got retired on ill health?
It’s not “law” unless the statements you made to obtain the mortgage were fraudulent, but your mortgage is bound by a contract which requires you to inform them of changes in your circumstances.
In notifying them, most of all they will want to be reassured about the affordability of your new mortgage, since you’ll be on pension income, not salary. Ultimately, Nationwide is a business who want to get their money back and will question you about your ability to repay the loan. It may well be that you have sufficient funds to repay based on any lump sum, ongoing pension income or drawdown. Hope it goes well but you’ll need all your numbers to hand.
Thanks for your reply.
I was working at the time of signing up for the deal and at the time I didn’t know when I would retire from work, it all happened very fast. Also I don’t think I answered any questions fraudulently.
Myself and my wife should have sufficient income to cover the bills and some savings.
Phew! That’s a relief 
Leaving work is a really big deal in all sorts of ways. Hope life is more comfortable without the need to keep turning up for work.
I knew it was coming since diagnosis but it all came about really quickly. I am better off for it health wise although I have a lot of free time now. I’m staying with my parents for a few months while my wife and daughter are away. They are retired so around all day which is good.