Help - Mortgage Problem to sell or rent! Long post, Sorry!

boo0704

Hi
I hope that someone can give me some advice, I am at the end of my tether and dont know where to turn next.

Basically we downsized in last September and bought, with a 5% deposit, porting a mortgage with Northern Rock.
My husband was made redundant in February 2008 and our Northern Rock expired in July 2008. Our payments interest only have gone up by 400pm.
Husband found employment in April, but too late for mortgage deals and had three deals swiped away and the Halifax accepted us on a fast track but the house didnt value by surveyer for LTV.
Husband has taken 50% paycut and I am 7 months pregnant (found out the week of the redundancy).
The way I see it at the moment, we have a house we cant afford to keep, its on the market but to sell would mean losing money, the rent wouldnt cover the interest payments, my maternity pay is fast approaching, and we are drowning fast.
We dont know what to do for the best, husband is becoming depressed and
so am I. The pregnancy has been stress from begging to end and I am now becoming resentful.
An option we thought was to rent for what we can get and rent with my parents and go halves, but all I want is to live with my children and my husband.
We have lost so much already and debt is increasing and my car is also for sale. I just feel its not fair, and want a break, but dont know which way to turn.
Thanks for reading and any advice would be great.

UK007BullDog

To be honest: Sell! Even if you make a loss.

Or take in a lodger. It might just make the difference on income.

Have you looked at all the other options of saving money?

In the mean time get hubby looking for a new, better paying job. Ask grandparents if possible to look after baby and kids and go back to work full time.

Once you go into maternity then its only a matter of time when you get repossessed if you cannot support the mortgage.

Why cant NR not give you a new deal? Did they ask for your current joint income? Go and see a broker or financial adviser for help. Also visit the debt free wannabee board for tips on saving.

But the main thing is for your hubby to find a new job. Its easier getting a new job whilst in a job than being out of one.

looster

When I had my first baby, the pregnancy was a surprise. We had just bought a house, having hocked ourselves up to the eyeballs, and without my salary we couldn't afford even the interest on the mortgage along with other debts that we had.

We had a similar offer to you from my parents and took them up on it - we rented out our beloved house for two years and moved in with them. The rent received didn't quite cover our interest and other costs (insurance etc) but our outgoings were considerably reduced by doing this. This gave me the flexibility to stay at home for a year with the baby and then take a part-time job after. We lived frugally during that time, repaid a lot of debt and managed to move back in two years after we moved out.

I was desperately sad not to be in my house when my first daughter arrived, but we managed to move back in two years later and it was a sweet moment when I had my 2nd baby at home in MY house earlier this year.

I just wanted to pass on my experience - I wont pretend it was easy, but there were benefits (lots of extra hands to help with the baby) and 4.5 years on, we still have our house which at the time seemed beyond contemplation because things were so bad. Like you we were torn between renting or selling - in the end, we decided to rent because it was easier and quicker to put in place rather than trying to sell. In the present market, I think it is easier to rent than sell so it might be better for you too.

I hope it all works out for you and best of luck with the baby
Best wishes
Looster

looster

Just read post above - when we moved back, we took in a lodger for about a year as well and that was great and brought in about £350 per month - but depends on area you live in I suppose. If you are under the Rent a Room scheme limit, you don't have to pay tax - see HMRC website.
L