Mortgage help whilst on Benefits.

dmg24

savingspender wrote: »

There is quite a bit of equity in the house so I will loose my right to any benefits on the sale of the house and will live off that. Just seems very frustrating when I have worked like mad for 10 years to keep the house and then I'm just going to have to give it all up where as others have never worked and have the security of a permanent council house. In my area there is no council list and so we will have to private rent which will give us no gurantee of a permanent home and the rent will be at least a £100 a month more than my mortgage payments.

Where are you ss? It may be that your council housing has been taken over by a social housing provider.

andyandflo

dmg24 wrote: »

What you have really said in all of your posts on this matter is I am very bitter because the govt would not help us with our additional lending. QUOTE]

Of course I was bitter, I think anyone would be. We had a mortgage that was only 50% of the sale value (the honest value - a price it could sell for)

The approx figures so that you may be able to understand it is that there is equity of about £80,000 in the house!

I won't go into why again they wouldn't help with the mortgage interest, it's not important now. What is done is done.

For the first time since handing the keys in, we have peace of mind knowing that the rent is paid for us.

As regards the schemes you mention - tried them all via Shelter. It seems most of them were a political statement at the time to make us feel some part secure in the knowledge that we would get help from someone.
Best advice is to help yourself and rely on no one!

By the way it wasn't additional lending, it was a mortgage to repay an unsecured loan which was used to buy the house

andyandflo

savingspender wrote: »

There is quite a bit of equity in the house so I will loose my right to any benefits on the sale of the house and will live off that. Just seems very frustrating when I have worked like mad for 10 years to keep the house and then I'm just going to have to give it all up where as others have never worked and have the security of a permanent council house. In my area there is no council list and so we will have to private rent which will give us no gurantee of a permanent home and the rent will be at least a £100 a month more than my mortgage payments.

If you hand the keys in, then there is no notional capital, it all belongs to the bank until after everything is paid off. You would get what is left. So you would get benefits until then - we do!

shegar

andyandflo wrote: »

In which case it may be wiser to 'bite the bullet' now and sell up or hand the keys in and when you are more settled, start saving for a deposit with a regular salary and buy again at a later date.

In the meantime if you are on low income, you will be entitled to help from the council towards the rent. It's not all gloom!

This has been coming for a long time, I handed our keys in a while ago and now rent. That's why I gave up my job and decided to go onto benefits instead. They pay for the accomodation and I don't have any more worries about meeting the mortgage payments each month.

Its not as easy as you say " hand your keys in buy again at a later date." if the OP hands the keys in it will be very doubt..ful if he or she can buy again.

As it will go on your credit rating , as soon as the OP starts to look into borrowing for a mortgage again it will instantly be rejected..

dmg24

shegar wrote: »

Its not as easy as you say " hand your keys in buy again at a later date." if the OP hands the keys in it will be very doubt..ful if he or she can buy again.

As it will go on your credit rating , as soon as the OP starts to look into borrowing for a mortgage again it will instantly be rejected..

I agree, plus the bank administrative charges will eat into any equity there is in the property, so for anyone who has any desire to be self sufficient it is a lose-lose situation.

andyandflo does not appreciate that private renting is far from ideal for a family, the prospect of having to move house every six months if the LL chooses not to renew the contract is very unsettling.

anmarj

dmg24 wrote: »

It does seem wrong that for a lender to change their rate they would need to give a full month's notice to the individual customer, yet the DWP do not have the courtesy to do this. I don't envy you having to deal with claimants when they realise what is going to happen.

i'm acting up in t/l mode and did speak to our team who do go on the phone and forewarned them that it was going to happen, we also have some that are due to start on phones shortly - did explain that we were not trying to put them off....

should say that they have all asked for annual leave that week:rotfl: which has been refused!

andyandflo

shegar wrote: »

Its not as easy as you say " hand your keys in buy again at a later date." if the OP hands the keys in it will be very doubt..ful if he or she can buy again.

As it will go on your credit rating , as soon as the OP starts to look into borrowing for a mortgage again it will instantly be rejected..

Why?
The house hasn't been re-possessed so it won't be on that register. Nor will it affect her credit rating because everything will be cleared with no outstanding debts before she gets the balance of the equity.
If there is no equity then there is no difference if she sells it herself, as she would still be responsible for the shortfall and that would appear on her credit file.

tcr_3

dmg24 wrote: »

It does seem wrong that for a lender to change their rate they would need to give a full month's notice to the individual customer, yet the DWP do not have the courtesy to do this. I don't envy you having to deal with claimants when they realise what is going to happen.

This change was signalled in the Budget. The statutory instrument to amend the SMI was laid before Parliament on 20th July and that's the date it became public. The statutory instrument says that the new SMI rate will be average mortgage rate as published by the Bank of England in August 2010.

Bank of England published that average mortgage rate on 31/08/10 and DWP made their announcement on 03/09/10. Now their staff have the task of reassessing tens of thousands of claims to tell people exactly how that change affects them.

It's not DWP's "lack of courtesy" ... it's the way the statutory instrument is worded.

dmg24

andyandflo wrote: »

Why?
The house hasn't been re-possessed so it won't be on that register. Nor will it affect her credit rating because everything will be cleared with no outstanding debts before she gets the balance of the equity.
If there is no equity then there is no difference if she sells it herself, as she would still be responsible for the shortfall and that would appear on her credit file.

You are not making your mortgage payments, therefore your credit rating will be affected. savingspender has stated that there is equity in their property.

andyandflo

dmg24 wrote: »

I agree, plus the bank administrative charges will eat into any equity there is in the property, so for anyone who has any desire to be self sufficient it is a lose-lose situation.

andyandflo does not appreciate that private renting is far from ideal for a family, the prospect of having to move house every six months if the LL chooses not to renew the contract is very unsettling.

They will anyhow as she will have to carry on paying the mortgage until it is sold irrespective whether she sells it herself or the bank sell it.

It is far from ideal for us too! (I'm 62 and my wife is 66 and both in bad health). I accept that we may have to keep moving every 6 months or so, it is just one of those things that goes with private renting.
But at least there is financial help towards the rent!