Cannot get out of trap

Daft_Pegasus

Personally I think the simple way out is to sell up. This may still leave you with debts but it sounds like every month that goes by the current debts are increasing. At least if the house was sold a lot of the debt would be gone leaving behind something a lot more manageable on your salary.

As another poster says £28000 is not low income and you should be able to pay off your debt, rent a suitable home and still have a reasonable standard of living on that salary.

LilacPixie

Sorry OP I may be misunderstanding but you have a mortgage of 224k and this includes arrears. You could sell up for 250k. You also have some other undisclosed debt.

I would suggest that with an income of 28k you will not get a remortgage and even if you did have a higher income your history of arrears would prevent you from getting a competetive deal. IMO selling is the best way to go. Once you have sold you can then rent somewhere a bit more financially viable.

financialbliss

Been following this thread in recent days. Don't think that the relevant info in all in one place, so here goes:

OP has an income of 28k:
Income: 28,000 - net income about 19,040pa or roughly 1,586.67 per month.

OP has a mortgage of 224k at 4.5% interest only:

Mortgage: 224,000 - IO payments of 10,080 or 840.00 per month
Also tackling arrears at £100 per month, so 940.00 per month.

So, based on info known:

Income: £1,586.67 / month
Mortgage: £940.00 / month

That's 59.24% of net income going to the mortgage and that's only clearing the interest month on month, ie the mortgage is not reducing. Just leaves £646 for the remainder of the bills each month: council tax, electric, gas, food, etc. Not much at all.

It's not so much that £28k is a low income - it's that 224,000 is 8 x salary, so I very much doubt another lender will allow that sort of lending multiple.

How much are the arrears? Perhaps head over to the debt free wannabe board, but I'd seriously consider selling up.

Financial Bliss.