Need advise on our mortgage

louisa29

we've got ourselves into a hole with our mortgage and dont quite know how to get ourselves out unless the property market picks up and A) our house earns equity or/and someone can afford to buy it

situation:
mortgage with Preferred mortgage in 2006 for £87,500 for 25yrs interest only payments on a variable rate

we missed the first few payments (DH lost his job the day the sale went through) so with interest we now own £5,000 on top meaning our mortgage is now £92,000 which obv isnt getting paid off because we pay interest only.

We have bad credit hence having to go with Preferred Mortgages. our interest rate is extorionate at 8% but with the variable influctuation has come down to 2.5% which was a nice letter to get on friday after work saving us £200 for the next 3 months :T

As time goes on the thing we need to look into is getting a lender for repayments, fixed rater and with a lower interest rate and eventually with a high street lender. but with our bad credit that wont happy anytime soon (although i am working on it)

DH wants to sell up and rent to but as i said with the property market being the way it is this wont help.

At the moment we have paid an average of £650-£720 every 3 months but for the next 3 months its going to drop to £440 per month

bigheadxx

Is DH back in work or still in receipt of JSA?

beecher

What's a realistic value for the house? If you didn't have much of a deposit you may well be in negative equity by now so if you decide to sell you'll have to work out how to pay the shortfall. You're not going to be able to change lender unless you have an LTV of 90% at the most. Also, you need to plan how you'll cope when interest rates climb.

louisa29

DH is back at work.

House is approx £90k so def neg equity