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Negative Equity
nicolabrown81
Posts: 22 Forumite
Hi,
Who else is in negative equity on there house, by how much and how are you dealing with this?
We brought our house for £104,950 and have just had it valued at a shocking £95,000 meaning we have lost just over £8,000 but we currently have a mortgage outstanding of £113,500! We were first time buyers when we first brought our house and our stupid mortgage adviser 'advised' just to add our outstanding debt onto the mortgage too with Northern Rock! Stupid I know but we first time buyers and we have really learned from this stupid mistake!
Who else is in negative equity on there house, by how much and how are you dealing with this?
We brought our house for £104,950 and have just had it valued at a shocking £95,000 meaning we have lost just over £8,000 but we currently have a mortgage outstanding of £113,500! We were first time buyers when we first brought our house and our stupid mortgage adviser 'advised' just to add our outstanding debt onto the mortgage too with Northern Rock! Stupid I know but we first time buyers and we have really learned from this stupid mistake!
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Comments
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As long as you learn then that's the main thing! We did the same thing many moons ago, but won't be caught out again!!0
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It's refreshing to here someone who is honest and realistic, the answer to your question is most who are, either don't know or would deny it.0
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It's refreshing to here someone who is honest and realistic, the answer to your question is most who are, either don't know or would deny it.
Thanks, we are wanting too sell as we are desperate for a bigger house as we have got a little girl but dont think we will be able too, got a meeting with the mortgage advisor at nationwide tomorrow as she says we may be able to take the negative equity with us too a new house (we will see), otherwise we are going to over pay £130+ a month for a until April 2010 and then £300 a month until our mortgage term runs out in Sept 2012 and hopefully the houseing market may have picked up a little again and we have gotten out of the negative equity and be in equity instead!!0 -
nicolabrown81 wrote: »Thanks, we are wanting too sell as we are desperate for a bigger house as we have got a little girl but dont think we will be able too, got a meeting with the mortgage advisor at nationwide tomorrow as she says we may be able to take the negative equity with us too a new house (we will see), otherwise we are going to over pay £130+ a month for a until April 2010 and then £300 a month until our mortgage term runs out in Sept 2012 and hopefully the houseing market may have picked up a little again and we have gotten out of the negative equity and be in equity instead!!
I wish you lots of luck, it's very good idea to overpay, however you may be being a little optimistic on being in equity in 2012 (thats if you bought at peak), still I hope it all works out for you, you sound like you deserve it.0 -
Adding debt to a mortgage is not a bad idea, especially if you get a better interest rate. What is a bad idea is to then forget about it and let the debt simply become part of your mortage, instead of increasing your repayments to clear the debt down in a sorter time period.
For example, if you have the choice of a 3 yr car loan at 16% APR or using adding the loan to a 5% APR mortgage then you're obviously better off adding it to the mortgage PROVIDING you also keep the 3 year repayment schedule and increase your mortgage payments accordingly.
How long ago did you buy the house?Mortgage Free in 3 Years (Apr 2007 / Currently / Δ Difference)
[strike]● Interest Only Pt: £36,924.12 / £ - - - - 1.00 / Δ £36,923.12[/strike] - Paid off! Yay!!
● Home Extension: £48,468.07 / £44,435.42 / Δ £4032.65
● Repayment Part: £64,331.11 / £59,877.15 / Δ £4453.96
Total Mortgage Debt: £149,723.30 / £104,313.57 / Δ £45,409.730 -
nicolabrown81 wrote: »We were first time buyers when we first brought our house and our stupid mortgage adviser 'advised' just to add our outstanding debt onto the mortgage too with Northern Rock! Stupid I know but we first time buyers and we have really learned from this stupid mistake!
That's a bit harsh. Negative Equity is only a problem if you need to move or remortgage. If you hadn't consolidated, then you would still have the outstanding debt, but would be paying much higher interest rates for it.0 -
My mate has a 79k mortgage, and needs a loan to do some home improvement work, cheapest option would be to add onto the mortgage. Mortgage company reckon the house is currently worth 62k, came as a bit of a shock. Obviously increasing the mortgage is a non starter.
How is he coping? Like thousands of others in negative equity - keep on working, keep on paying the mortgage. Ok, the home impovements are on the back burner while he saves up to pay cash, but its not the end of the world. In fact, he's incredibly laid back about it all.
So long as you can keep paying the mortgage and don't have to move, just get on with life. If you can't pay, or have to move, then its more of a worry.0 -
I don't know if I am or not, I would think I'm very close. Abbey didn't even mention my LTV when I remortgaged recently.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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You need to put down as much as possible before rates start to go back up. Get as much paid off.
As for getting another mortgage, I dont think you are being realistic... you have more than 100% loan at the mo and unless you can get your loan down to 90% of your next home value you are going to be paying through the nose in hefty rates and fees... It is effectively a subprime mortgage.
Sorry, thats just the way it is I am afraid.
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nicolabrown81 wrote: »Hi,
Who else is in negative equity on there house, by how much and how are you dealing with this?
We brought our house for £104,950 and have just had it valued at a shocking £95,000 meaning we have lost just over £8,000 but we currently have a mortgage outstanding of £113,500! We were first time buyers when we first brought our house and our stupid mortgage adviser 'advised' just to add our outstanding debt onto the mortgage too with Northern Rock! Stupid I know but we first time buyers and we have really learned from this stupid mistake!
£104.950 - £95,000 = £9,450 (not just over £8,000)
Adding expensive debt to a cheap loan wasn't the problem. Bringing a house when you couldn''t afford it was.
You need to keep paying and, in time, the sum outstanding will fall. One day, you will not be in negative equity. Assuming a repayment mortgage, you will be mortgage and rent free one day.
GGThere are 10 types of people in this world. Those who understand binary and those that don't.0
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