debt problems ruining my life

Mentalminis_2

Hi

thanks for your support and well wishes they are much appreciated. i had thought about the remortgage route but haven't actually looked into it due to the fact the when i got my mortgage i was earning in excess of £1200 a month take home, and at present i am down to as little as £425 a month, it a hell of a lot of money to drop and as far as i am aware i would basically not qualify for a mortgage of any kind on that kind of money.... plus i have only had my mortgage for just coming up to 3yrs in feburary and cant see my gaining that much in the price of my property as i think the house prices were just about leveling off by then.... whilst the house prices are still crazy i don't think they rose that much since i purchased my property...... i shall be having some agents come and give me some estimates regarding both house sale prices and possible rental incomes so i shall know more then... tbh only being 25 i don't know a lot about all the housing thing

Entrepreneur_en_faillite

Mentalminis wrote:

Hi

when i got my mortgage i was earning in excess of £1200 a month take home, and at present i am down to as little as £425 a month,

Hmm, now I'll be a little controversial now. It is possible to remortgage even if you don't have the proveable income. It may be possible to remortgage to a lender who will work upon affordability rather than actual income. For example, if your mortgage costs, say £500 per month, and a remortgage would reduce that cost down to, say, £300 a month, there are lenders who may consider your application.

Mostly their decision would depend upon the equity in your home, so how much is your home worth (approx) or if you don't know that how much did you pay for it and when did you buy it? I would also need to know how much your outstanding mortgage is.

Another option is to ask for your mortgage to be put on an interest only basis for a while, or ask your lender for a short payment break to help you out

Mentalminis_2

Hi ENF

have been into the mortgage company to see if i am allowed to rent my property out and found out a few things about my mortgage.

it's a straight repayment mortgage - which i knew already
it was originally for £58.000 (feb 2003)
and it was over a 30yr term ( i thought it was 25 but it said right on the screen 30)

we had a look into going interest only, and whilst it would save me a little it is not that much to be worrying about really. i could take a payment holiday but under my circumstances that would be risky as i don't have a higher paid job in the pipe line or anything like that.

As regards to renting the property i still have to find out for definate, however i was told by my mortgage advisor that it is not generally a problem, as long as... the total time spent as a rental property doesn't exceed 3yrs... she said this was because of mortgage packages and if i were to rent for longer i would have to look at changing my mortgage to a specific buy to let mortgage.

i think my house would be worth roughtly 70-75k and now my parents are pushing me in the direction of selling it and grabbing the money as to pay the mortgage off it would only be £53k leaving me with a pretty good profit margining for basically owning it 5yrs and fitting 3k's worth of double glazing and a lick of nuteral paint everywhere. it would also mean that with that profit i would be able to pay off all my debts in one hit..... how ever i am really concenered about ever getting on to the property ladder again, i can see the advantage of it don't get me wrong... but if i can rent i don't see why i should sell up.

Entrepreneur_en_faillite

Mentalminis wrote:

As regards to renting the property i still have to find out for definate, however i was told by my mortgage advisor that it is not generally a problem, as long as... the total time spent as a rental property doesn't exceed 3yrs... she said this was because of mortgage packages and if i were to rent for longer i would have to look at changing my mortgage to a specific buy to let mortgage.

i think my house would be worth roughtly 70-75k and now my parents are pushing me in the direction of selling it and grabbing the money as to pay the mortgage off it would only be £53k leaving me with a pretty good profit margining for basically owning it 5yrs and fitting 3k's worth of double glazing and a lick of nuteral paint everywhere. it would also mean that with that profit i would be able to pay off all my debts in one hit..... how ever i am really concenered about ever getting on to the property ladder again, i can see the advantage of it don't get me wrong... but if i can rent i don't see why i should sell up.

Strange comment from the mortgage adviser, I assume taht you are on a mortgage deal with three years to run.

I have to agree with your parents I'm afraid. I know it's tough, and it doesn't seem fair to have to give up so much, if you continue down the road you are going you may well end up losing it in the end anyway unless you up your income considerably. Don't worry about getting back on the property ladder too much, but do worry about your finances right now. Address them and all will work out in the end.



The Scots say 'many a mickle maks a muckle' which means look after the pennies and the pounds will look after themselves, don't be afraid to sell the house for security of your financial future.

Mentalminis_2

I wish i did only have 3yrs left to run, unfortunatly i am not quite 3yrs into a 30yr mortgage term at present. i think it's because they have special mortgages as it would turn out to be a buy to let property, i am not 100% sure on there reasons, and it only says i have to advice them if i feel it would be for longer than 3yrs, it doesn't actually say it would be a problem or not.... however i am not quite sure how they would tell if i went over the 3yrs anyways.

have been given the green light as to renting the property out anyway, and have some agents coming over tomorrow to take a look to guage rental income potential, i have been told over the phone that 1 company would normally be able to get £495 for the property, but that would mean less 10% management fee's so £445.5 in my pocket.... i did however ask them to call over and double check this but they can't make it until next week unfortunatly.

I have decided that if this is the kind of money i am likely to be able to get then i am going to go the rental route.... it's easier to sit there and say sell your house and be clear, but another when you have had to fight tooth and nail for the thing for the past 3yrs to just give up.... it's not a total solution i know but i think it is much more workable, in the 3yrs i will all but certainly have a better income. and then have the option of moving back in to my home.

halloweenqueen_2

Will you be living back with your parents? or will you be renting a place for less money than yours. If you can rent your house out I would if it were me, can you rent it our on a yearly basis, with scope for your tenants to renew? So if something dramatic happens like a good job change,your could get back into your house after 12 months?
Wish you well and hope it all works out for you.!!

Mentalminis_2

Hi Queen

Am glad someone is on my wave length here..... i would indeed be moving back in with my parents, paying them a little towards food etc..... have just had a estate agent around though, i think it's going to be a tough fight with my parents if his sale price is anything to go by, have made loads in the past 2 and a bit years. i know they only advisory prices and not dead certs.... however.....

i bought the house in feb 2003 for 60k and this chap thats just been has priced it up at 110k, thats 50k profit for just living here.... something tells me my parents eyes are gonna go CHERCHING CHERCHING!

may the battle commence...lol this is only one quote i have another this afternoon, rental was a little lower than i had hoped at only £380 - £400pcm i was hoping for more in the region of £450 pcm.

perhaps i could look at a remortgage instead if the property has that much in it, my orginal mortgage only being 58k to start with. i could do both that way until i deffinatly had a better job.

ps....well done on the november shopping budget, keep up the good work and fight the good fight, just goes to show you can do it...well done!

the*dark*one

Mentalminis I don’t want to appear rude but can I ask, which area do you live in?

Mentalminis_2

i live in norfolk....king's lynn

halloweenqueen_2

Well you have the technical college there, having you though about getting a group of students in, I would advertise it at the college. Is it 2 or 3 bed. if its three you could get 3 student each paying 150 a month, which would bring you 450, or if its 2 bed, perhaps a reception room could be a bedroom?