moving back in to neg equity prop before BR?

debtfreeforme

Hi all

I wonder if i could ask your advice please?

We are currently on a DMP with CCCS for £30k debts, which we are paying at £140 per month. At this rate it will take 15 years to become debt free :eek: as our financial situation is unlikely to improve in the near future (just had our 2nd child and i am studing for a degree with the OU). We just want to put it all behind us and make a fresh start.

We moved out of our mortgaged property a year ago as it is very small and in negative equity so we couldn't sell. We now rent our house out to tennants, which covers our interest only mortgage payments and are renting somewhere bigger for ourselves.

We really wanted to avoid going BR as we beleived that we would lose our house but I now understand that it is possible to keep your house if it is in negative equity as long as it is the home that you are living in.

So... we are planning on moving back into the house in 6 months time (have just had new tennants move in) and go BR at the same time. Hopefully house prices won't have gone up too much in that time and we should be able to hang onto the house.

Can anyone think of any reasons why this wouldn't work?

Thanks so much.

peachyprice

No reason whatsover, sounds like at splendid idea. As long as you can afford the mortgage, preferably switching back to repayment once you're out of BR and can learn to live in the smaller space.

debtfreeforme

peachyprice wrote: »

No reason whatsover, sounds like at splendid idea. As long as you can afford the mortgage, preferably switching back to repayment once you're out of BR and can learn to live in the smaller space.

Thanks - will speak to CCCS next week and get the ball rolling.

Getting use to the smaller space will be a challenge for sure but it's for a very good reason. I'm going to right all the reasons down, laminate them, put it on the wall and look at it every time we are having a moan about lack of space.

We've got a friend with an organic farm, who is giving us some land to grow veg so will just have to spend lots of time there. And will save some money by growing our own food too:j
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