Big House, bigger mistake

Rockporkchop

Do you actually want to sell the house or are you happy there apart from the finances? Buying and selling costs would be over £20k and added to the £6600 that is a lot of money that could have been spent paying off some of your current mortgage.

What rates are you paying for your o/d and credit cards and what sort of balances are outstanding? If you are paying high interest, maybe consider keeping the fixed rate but change to interest only for a short time, pay off all your outstanding debts with the extra money and then switch back to repayment. Or just switch to interest only until the fixed rate is up anyway to give yourself some breathing space and maybe your financial position will be completely different by the time the fixed rate ends.

In the meantime, is the house really big? You could get a lodger to bring in some extra money tax free, I know it's not everyone's cup of tea though.

struggling-breadwinner

apologies, brain fogged by vodka consumption!!!! current house value at £420k (not £320 as above) hence mortgage o/s at £240k (ish) currently, balance equity. New property will require cira £150k mortgage if we use some equity to pay ERP and other debt (plus stamp etc cause we aint got no cash.....)

struggling-breadwinner

nope rockporkchop - I really do HATe the house too....I've started to resent it. I also don't like my job and want a change. Better quality of life etc so this nescessitates a pay cut. I have a high profile high stress job which is affecting my health :-(

franklee

struggling-breadwinner wrote: »

apologies, brain fogged by vodka consumption!!!! current house value at £420k (not £320 as above) hence mortgage o/s at £240k (ish) currently, balance equity. New property will require cira £150k mortgage if we use some equity to pay ERP and other debt (plus stamp etc cause we aint got no cash.....)

Ah I get it now. Well if you want to downsize I'd do it sooner rather than later as the house market is more likely to get worse than better IMO.

I agree that the penalty to switch from the 240K mortgage to the 150K one is 2,475. As this is only 0.6 of the value of the house it's not worth worrying about IMO if the bigger picture is you really want to downsize and change jobs to a lower salary.

silvercar

You need to do things in the right order if you want to get the mortgage approved.

Move home first and then change jobs. You are unlikely to get a 150k mortgage on a salary of 30k. I would question whether you should really want a 150k mortgage on a 30k salary.

Even if a mortgage is portable, moving home is still a new lending decision. So you need the LTV to be within the range allowed and a decent credit rating and an income that supports your new mortgage size.

spuds_2

I agree with Silvercar - move house first and get your finances in order, then change jobs. You may even find that once the financial pressure is lightened, you can cope better with job stress. Money worries can seriously affect your health, so you are right to start addressing these issues now. Having a big house isn't everything - health and peace of mind are much more important. Good luck.

lonestar1

struggling-breadwinner wrote: »

.....newjob has good regular and secure payrises as public sector

Be careful a lot of folk think the public sector is going to take a bashing when the government has to start repaying the billions its borrowed to get us through the recession

struggling-breadwinner

Move home first and then change jobs. You are unlikely to get a 150k mortgage on a salary of 30k. I would question whether you should really want a 150k mortgage on a 30k salary.

hubby earns £30k too. Kinda working on 3.5 x 60k at lowest possible household ebb. Have spoken with Santander today about possible solutions. i have to say they were very nice. Nicer than I expected....

typeractive

struggling-breadwinner wrote: »

feel like a goon. I have a Masters!!! clearly no common sense though!!!!!!

Look at the positives, you've seen the light as they say. Many of my friends whom never went to university often bring up in conversation that they aren't as bright as me etc, to which I respond "an education or certificate does not prove the level of intelligence (for the mass majority anyway)", it merely shows you have the commitment to study for a length of time - I then question them about their favourite subject e.g. football, music etc the amount of knowledge they hold is amazing - this often makes them understand where I'm coming from. The majority of my successful mates (judging with finances) never went to uni - left school at 16 etc.

I know your comment was just meant in jest, and obviously you have a good level of intelligence really to hold down a job that pays so well etc so please don't think I'm 'teaching' you anything - I have a habit of rambling on and I just thought it might make others think differently.

oh the opnly thing I woul add, which may change everyones views a bit is that I am thinking of packing in a £75k pa job for a £30k one cause I HATE my job. in light of this perhaps changing would be good for (a) the immediate relief of lower payments (newjob has good regular and secure payrises as public sector) and (b) no 3 months payslips in 2011 when remortgage off fixed deal required. DON'T worry tho, have learnt from my mistakes and have calced out the value of mortgage I can REALLY afford ont he reduced salery if I go for it

It's sad that you HATE your job. Before you jump into the job in the public sector, think long and hard about any changes. May I ask what occupation you would be thinking about? Many public sector jobs are very stressful also - more than you may think.

Good luck with whatever you decide to do - I think you'll be fine and dandy - take on board the advice of many people on here, they're a good bunch!

struggling-breadwinner

Thanks Tpyeractive :-) Absolutely no offence taken on the graduate comment ! I have often said that I seem to be very good at the "bubble" of academia as long as it never grounds in reality.

it may not come as any surprise then to hear that I am thinking of becoming a lecturer instead of a lawyer!

I know that every job has stress and that the grass isn't alwys greener but I have a very young family and I no longer feel the "thrill of the kill" that I used to. I'm just tired of commuting and working extra long hours and missing my kids grow up. In no way am I wearing rose tinted specs (I hope) I have no doubt that lecturing if tough but the meer lack of a 3 hour round trip for work will make a difference in terms of fuel costs and sanity!!!!