Debt Advice please.

Ribbons473

Thanks guys

Hannah_10 - Our Income is £59000 not £36000 and yes when our daughter was born in 2005 we lost my salary which was around £25kpa, so that hit hard and with the greatest respect we dont have all the trappings we have a house that is worth that amount and a car but thats it, we have no 'life' whatsoever, we dont go out we dont go on holidays we hardley ever buy new clothes etc etc. If we sell and start afresh we would have over £1000 pm free to start enjoying our life with our girls which I feel is more important than having a nice house

HappyMJ

Where do you get £1,000 from? if you were to take out a new mortgage at 90% LTV it MUST be a repayment loan let's say we use your example and you buy a house worth £300,000 and put down £30,000 after taxes/fees/moving costs and charges. The mortgage repayment on £270,000 would be around £1,600 per month. That will cost you £700 per month more than you are paying now.

Ribbons473

Thanks, we have spoken to C&G and they have told us our product is completely portable and we can go up to 90% so we would continue on the same rate and terms we are on now until the end of our current deal so that means we would be paying £855 pm at the current rate, unless I am getting this wrong :question:

Thank you for all your advice so far.

Hannah_10

You say you have no life whatsoever, but you've spent this money somewhere. If it wasn't living above your means what was it?

And £3k p/m x 12m = £36k.

If he's on £59k and you're still £77k overspent in 5 years that makes the gap bigger not smaller.

I know you must feel like I'm being critical, but honestly that is not the intention. Can you not see that there is a whopping great gap here? Until that gap truly dawns on you both then you're not going to ever be able to be financially secure. I would like you to be financially secure, that would be brilliant. To do so means you really do have to look long and hard at how you came to be £77k in debt and how to pay back that £77k (plus a 5 figure number more in interest) and satisfy your living expenses at the same time.

isy1011

I can understand that you find some of the comments quite hurtful because when you put up a SOA we can all analyse it and pull it apart. Unfortunately, the point that the truth hits and you realise OMG we are in the sh** then that's when you can start coming out of it.

Have you really explored the house sale issue e.g. exactly what the costs will be? Would a better option be to rent for a while? Beware of the market with house prices because you may end up with a 300K house that you have a bigger mortgage for than you are paying off (because you opt for an interest only). Im no expert with mortgages but I thought building societies need some sort of evidence that you are paying into a separate account to be able to pay the balance.

HappyMJ

How are you going to repay the capital? 90% interest only mortgages are rare, so rare that I can't even find 1 on the market and you must have a repayment plan in place. What's going to happen in 30 years time when it comes time to repay the loan. Sell? Where would you live then? It works at 75% because you can move to a much smaller place (i'm talking 1 bed flat) that you own 100% but it doesn't work at 90%.