Is this really a good time to sell a home?

lotto-dreamer

EdInvestor wrote: »

Where are you planning to live if you sell?How much rent will you have to pay and how does that compare with your existing mortgage?

Have you looked into remortgaging? You would appear to have around 22% equity, is your credit record reasonable?
My credit record is supposedly very good - as I've been told when I've applied for anything - it's just that my income to outgoings ratio is too high now

When I'd originally tried remortgaging with my own bank (who know my income and outgoings) they pushed a loan onto me instead. Which is rather how my current situation started .....got hard going to pay loan on top of repayment mortgage, started to use credit card for basics, food etc...(my fault I know but still) and the whole sorry cycle got going..



How does the position look now that NR has cut the SVR by 1.5%?

Since switching to interest only I've been paying £474.40 pm - (my mortgage is £79,741.41) but with a 1.5% cut it will be approx £388 I assume - no confirmation from them yet. However I will still have the wretched loan and credit cards round my neck. Rent I'm looking at £650 -£750)

It doesn't look to me as though you will get much advantage from selling in the long term, but a proper understaqnding of your position would need info on your age, retirement plans, pension provision etc.

Okay, age ...born in the 50s . No retirement plan or pension provision -planning to die young(ish) at the moment. Also have two sons who live with me, one contributes -but is now self employed - used to earn more than me - is working on a project (computer related) which could be very lucrative and does bread and butter jobs (websites) in meantime and other has just finished college and is to put it optimistically still deciding what to do (is into music production).

If retirement is not far off and you are likely to be claiming pension credit at that time, then you can also claim housing benefit to pay your rent, so it might make sense to sell. But if you will have more income than the benefits level it would make sense to stay put at least for the moment.

point taken -but I hate the thought of benefits. The tax credit situation was a nightmare (that didn't help my situation either - but won't go there)

The fundamental need would appear to be tackling the debt and establishing a budget you can stick to, so it doesn't build up again.
MSE has been a godsend in helping me to keep expenses down and keep going (and the moral support on here) - but the writing is on the wall and I need to do something more drastic now. For extra income I sell books on Amazon (I have a large personal collection) and sometimes sell on eBay which helps.

hethmar

Lotto, bit too late now I guess, but you could have gone to the CAB for advice on all these matters and may be have found benefits that you could have claimed. It sounds like everything is getting on top of you at the moment and I can understand the temptation to sell up and be clear of all these debts and worries. Where are your sons going to live? Are you planning to rent along with them?

EdInvestor

Have you made any progress on your debt since last March?
http://forums.moneysavingexpert.com/showthread.html?p=9216277#post9216277

I'd suggest you need to get real with your sons - they must pay their own way or move out and claim through the system. You could probably resolve your debt problem quite rapidly if they left and you had a paying lodger or two instead.

You really need to go over to the MSE debt forum and post your detailed SOA budget so people can help you get a grip.Otherwise I fear you will end up on benefits with no assets and no secure home in around 10 years' time.This is a prescription for a very unhappy old age.

You are not doing your boys - or yourself - any favours by failing to adopt a disciplined approach to money, you know.If you are not careful, it will blight their futures as well as your own.

lotto-dreamer

EdInvestor wrote: »

Have you made any progress on your debt since last March?
http://forums.moneysavingexpert.com/showthread.html?p=9216277#post9216277

I'd suggest you need to get real with your sons - they must pay their own way or move out and claim through the system. You could probably resolve your debt problem quite rapidly if they left and you had a paying lodger or two instead.

You really need to go over to the MSE debt forum and post your detailed SOA budget so people can help you get a grip.Otherwise I fear you will end up on benefits with no assets and no secure home in around 10 years' time.This is a prescription for a very unhappy old age.

You are not doing your boys - or yourself - any favours by failing to adopt a disciplined approach to money, you know.If you are not careful, it will blight their futures as well as your own.

You are quite right - I know what you are saying is very true. It's actually helpful to have someone be objective and highlight what I try to avoid facing.

But, there are so many other issues - and yes, I know I'm not doing my sons any favours. I've been guilty of trying to make up for some past problems in their lives which I feel desperately guilty for putting them through - I don't want to go into details, closed and painful subject. Unfortunately, I don't have any family to help with my sons -I do have a couple of good friends but they don't have financial problems and I don't like to talk about it. Again, MSE has been a lifeline.

Perhaps it's too late to post my SOA - I have done the CCS online debt remedy a few times - the first one suggested selling up - but the most recent one said I could go for a DMP or voluntary one perhpas - 10 years and 8 months or something to clear my debts.

You can see why I have the stupid name of "lotto-dreamer"

lotto-dreamer

EdInvestor wrote: »

Have you made any progress on your debt since last March?
http://forums.moneysavingexpert.com/showthread.html?p=9216277#post9216277

You are not doing your boys - or yourself - any favours by failing to adopt a disciplined approach to money, you know.If you are not careful, it will blight their futures as well as your own.

Reading it stated like that is the best advice (and wake-up call) I have had. It's been obvious, but I couldn't see it so clearly until I read that, stupid as that sounds. Thank you.

EdInvestor

lotto-dreamer wrote: »

I know I'm not doing my sons any favours. I've been guilty of trying to make up for some past problems in their lives which I feel desperately guilty for putting them through ..

You've protected your boys as they were kids (and they'll be grateful for that in years to come ), but now they've grown up and you need to work as a team to get the finances sorted. Otherwise you're all going to lose your home. What will they think of that, have you asked them?

So they need to help you get this scenario sorted , and they need to contribute to the home (albeit that this might be via reduction in costs or claiming entitlements, or getting a part time job low level for a while.)

It should be a matter for all three of you to decide on.It will be a very good learning experience for them, don't you think?

Perhaps it's too late to post my SOA

It's never too late, it is amazing what immediately becomes obvious when you put the figures down in black and white.

It's also amazing how rapidly the debt starts to diminish if you use the "snowballing" system to reduce it and stop interest from compounding up via credit card balance transfers.

10 years and 8 months or something to clear my debts.

I'd have thought you could get it sorted much faster than that.

lotto-dreamer

Thanks so much for all your advice everyone

- and EdInvestor, you've really helped me see more clearly. I probably should have posted my SOA up a long time ago - I felt so embarrassed I'd got myself into such a mess and kept thinking things would work out. I have learnt a lot from the MSE forums though.

I'm going to have a good hard think about it all and have a look at my finances again - and a family round table discussion might be a good idea over the next few days.

pawpurrs

Do your boys know the situation?

space_rider

If your rent is going to be more than the mortgage you`re paying now, won`t you be tempted to dip into the savings. Before you know it you`ll have lost all the equity you had in your house. If you are still earning then you won`t qualify for housing benefit and you`ll be in a worse situation than you are in now.

lotto-dreamer

The whole sorry sad story - I can see I've lost my house.

I don't want to put this onto the DFW board - it's too late. I have buyers wanting to get moving and I have to find somewhere to rent (I'm going to look at a property today in my lunch hour).

This is what I should have done long ago before things got so bad. I am an idiot. I could have done things so differently. EdInvestors words are haunting me - I have really messed things up for my sons as well.

If nothing else - perhaps someone else who is still hesitating might decide to post their SOA now and get help more quickly.

(The CCCS debt remedy calculated after essential expenses I had 337 to service debts and would take 10 years and 9 months provided interest rates could be frozen etc)

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1173.59
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 450
Total monthly income.................... 1623.59

Monthly Expense Details
Mortgage................................ 474.4 (interest only)
Secured loan repayments................. 317.62
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 105
Electricity............................. 49 (dual Eon)
Gas..................................... 49 (dual Eon)
Oil..................................... 0
Water rates............................. 42.06
Telephone (land line)................... 25
Mobile phone............................ PAYG (approx £2 pm)
TV Licence.............................. 11.29
Satellite/Cable TV...................... 0
Internet Services....................... 27.99 (high but 3 user)
Groceries etc. ......................... 260 (var)
Clothing................................ Petrol/diesel........................... 33
Road tax................................ 12.5
Car Insurance........................... 26.26
Car maintenance (including MOT)......... 15
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 20.46
Contents insurance...................... 0(included in blgs)
Life assurance ......................... 50.54 (mortg decrse)
Other insurance......................... 10 (life natwest)
Presents (birthday, christmas etc)...... 0 (credit cards)
Haircuts................................ 11
Entertainment........................... 12 (newspapers)
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1625.12

Assets
Cash.................................... 60(var. amazon sales)
House value (Gross)..................... 158500 (offer accepted)
Shares and bonds........................ 0
Car(s).................................. 800 (?) Ford Fies v reg
Other assets............................ 3000 jewellery/antique)
Total Assets............................ 162560

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 79741....(474.4)....7.38
Secured Debt.................. 0........(317.62)...0
Total secured debts........... 79741.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Natwest Loan...................18707.....317.......8.5
Natwest Credit Card............7200......159.......21.66
Egg Loan.......................4278......104.......6.73
Natwest overdraft..............4000......0.........0
Capital One....................4000......120.......15.38
Egg Credit Card................5600......112.......16.9
Total unsecured debts..........43785.....812.......-

Monthly Budget Summary
Total monthly income.................... 1,623.59
Expenses (including secured debts)....... 1,625.12
Available for debt repayments........... -1.53
Monthly UNsecured debt repayments....... 812
Surplus(deficit if negative)............ -813.53

Personal Balance Sheet Summary
Total assets (things you own)........... 162,560
Total Secured debt...................... -79,741
Total Unsecured debt.................... -43,785
Net Assets.............................. 39,034

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.