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Advice - should we sell & rent?
Fizz_Bomb
Posts: 51 Forumite
Hi, I'm new here!
Just wondering if anyone is clued up enough to give advice on my situation as I have no idea what to do!!
Brief story is that we bought a flat just over 3 years ago. We went with a Northern Rock 5 year fixed together mortgage which was a 100% mortgage. We hoped we'd make money on it, but haven't and probably owe just about what we borrow give or take a thousand or so either side. (paid £81,500 - borrowed 5k on top).
Story is now that our circumstances have changed quite a bit and we now have a child, I only work part time and my husband is self employed so after expenses and so on he doesn't earn a great deal on paper. The second thing is that we have quite a bit of debt, 2 credit cards and a loan.
We are desperate to move house in order to get to a nicer area for our son going to school and to have a bigger house, but it seems hopeless that anyone would lend us any more money to move because of our low joint salary and lack of equity.
I'm now considering that we should just sell it and rent, then hopefully start out again on the property ladder in a year or two. Does this seem like a good idea or are we mad to sell up?
Grateful for any input at all!
Thanks!
Just wondering if anyone is clued up enough to give advice on my situation as I have no idea what to do!!
Brief story is that we bought a flat just over 3 years ago. We went with a Northern Rock 5 year fixed together mortgage which was a 100% mortgage. We hoped we'd make money on it, but haven't and probably owe just about what we borrow give or take a thousand or so either side. (paid £81,500 - borrowed 5k on top).
Story is now that our circumstances have changed quite a bit and we now have a child, I only work part time and my husband is self employed so after expenses and so on he doesn't earn a great deal on paper. The second thing is that we have quite a bit of debt, 2 credit cards and a loan.
We are desperate to move house in order to get to a nicer area for our son going to school and to have a bigger house, but it seems hopeless that anyone would lend us any more money to move because of our low joint salary and lack of equity.
I'm now considering that we should just sell it and rent, then hopefully start out again on the property ladder in a year or two. Does this seem like a good idea or are we mad to sell up?
Grateful for any input at all!
Thanks!
0
Comments
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If you're in debt and are surviving on only one modest salary. it sounds like you can't afford a mortgage at all. Sell up and rent0
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Welcome to MSE!
This site is HUGE so have a good read around, lots of useful information on the 'Up Your Income', 'Debt Free Wannabe' and 'Benefits and Tax Credits' boards.
Are you sure you will break even after three years, have you looked at sold prices for your block and have you factored in all the costs of selling?
www.houseprices.co.uk
Are you claiming all the benefits you are entitled to?
http://www.entitledto.co.uk/
Have you looked at whether you'd be eligible for a Debt Relief Order or Debt Management Plan via one of the debt charities?
http://www.cccs.co.uk/
http://www.payplan.com/
Budget Planner used by DFW board, complete in full and post up there for support and advice:
http://www.makesenseofcards.com/soacalc.htmlDeclutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️0 -
BitterAndTwisted wrote: »If you're in debt and are surviving on only one modest salary. it sounds like you can't afford a mortgage at all. Sell up and rent
Thanks for the advice...we are comfortable paying our current mortgage and are chipping away at the debt slowly but surely...perhaps I should have said in my original post that when I say we want to move I am under no illusions that we can afford to take on a big mortgage and only would want to take on a relatively small extra amount, mainly to move areas rather than to something we cannot afford.
Thanks again for the reply.0 -
Selling up, buying another property and moving will cost you thousands. If you don't have that saved, you can't move. It sound like your child is still quite young, so why not sit tight, pay off your debts and then move when you've built up enough savings?0
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