Can Anyone help?

mick1234_2

hi i am just looking for a bit of advice, I own a property the mortgage is £105,000 my ex girlfriend is still on this, we are speaking and she is fine to wait until i can get it moved.
Now the problem is the property is in negative equity about £5000,on my own my current mortgage company will only give me £80,000 so thats £25,000 i need to find which tbh sounds near impossible.

I have moved out of the property and my cousin is renting it he is paying £750 this includes bills there is a little profit here, I know it is not an ideal situation as it should be on a rental mortgage but until I can work out what to do it is helping me out, I have a £4000 loan which I am paying off with my wages and profit off the rental, but after this is paid im not sure what i should be doing, i've worked out I can pay around £5000 a year off the balance of the mortgage it just seems endless to pay of £25,000

ideally i'd like to get on a buy to let as it would be nice to keep the house as its my only asset but a 25% deposit is just impossible.
I appreciate any help anyone can give as im lost for ideas i have a budget and im living basic i dont go out drinking and dont buy new stuff as i want to sort this out and buy another house one day:j
thanks

Cannon_Fodder

How much do you pay, where you live now?

If more than £750, move back in and save some cash ?

mick1234_2

im renting a room at a mates costing me £200

RedSoleShoes

You are going to get lots of negative comments on here about not having permission to let from your mortgage company.

If BTL mortgage is out the question, then all you can do is sell or move back in yourself and rent out a room (if it's not a 1-bed!).

Can you afford to pay your ex rent for her part of the property?

mick1234_2

hi
I know about the buy to let situation isnt ideal but i had run out of ideas, I needed to move out fresh start etc we had been together quite a while, I can afford it but i have more money now it is rented, were as before I was just scraping by,.

redb_2

"ideally i'd like to get on a buy to let as it would be nice to keep the house as its my only asset but a 25% deposit is just impossible."

i realise you have a lot of emotions and history tied in the house that was your home. But looking at it from the outside its not an asset its a liability - its in negative equity - get rid.

mick1234_2

do you think this is this best option even if I am making profit off it at the minute?

JonnyBravo

Presumably you're not paying tax on your profit?
What you going to do if they find you and fine you? You still in profit then?

mick1234_2

no im not, I guess your right I will look at selling I guess its the best thing to do and start again

terryw

JonnyBravo wrote: »

Presumably you're not paying tax on your profit?
What you going to do if they find you and fine you? You still in profit then?

The OP would be well advised to declare the rental income. After mortgage interest has been deducted there is likely to be little profit.

I doubt if HMRC would be bothered that a "buy to let mortgage" was not in place. I doubt if they would even know.

Or am I wrong?

luckyfool

He would only be taxable on the "profit" on the rental. He can only deduct the "interest", not any capital repayments, but he can also deduct for wear and tear and expenses as well. It can either be itemised, or if I remember rightly it can just be treated as 10% of the rental income. i.e. if the interest payments to the mortgage are not much less than the rent then there is unlikely to be a tax liability.