Should I sell the house and rent instead?

PasturesNew

For £200/month, or so, when you don't need to sell ... isn't worth it. Make the decision for other reasons, not just saving £200/month. The costs of selling/renting will be thousands, so that bit of the maths, alone, doesn't stack up.

PasturesNew

hermum wrote: »

chances are that if you bail now you won't get back on the ladder.

Ponzi schemes don't have ladders... and there's no rush.

I was 40 when I first got onto that 'ladder', waited 20 years.... there's always a time, at some point, when one can buy a house, somewhere. Possibly.

But if not, it's not that important so long as you're happy.

cannegan

Well, I suppose the other reason is so we can have a much bigger house! We're a bit pushed for space. Thanks for the advice about costs though, you may have changed my mind!

Eric1

cannegan wrote: »

Hi there - really confused so hoping someone can advise. We have a secured loans / mortgage worth around £125000 on a house worth £135000. We are also in a debt managment plan with payplan to repay debts of around £50000. Also have a car loan of £270 / month.

You have three loans, presumably with different interest rates, and your net balance is negative. Assuming the value of the house will not change, you will be better off paying off the most expensive loan first.

themull1

i personally wouldnt sell for the sake of 200 quid a month, if you had enough equity in the house to pay off the 50 grand as well maybe. could you put a room in the loft evenyually?

Henry_P_Chester

MadnessOfHPC wrote: »

When you're on the ladder it's madness to jump off.

But with prices falling it's a snake not a ladder. The longer you leave it before selling the less you will get for it.

Sell now, rent and use the £200 per month to repay your debts. You're effectively renting from the bank at the moment anyway so by selling you'll also get the added benefits of no maintenance costs etc.

What will you do when interest rates rise?

It's a no brainer IMO.

tyllwyd

On the other hand, if prices stay the same or rise selling now might make it very difficult to buy back later. If you sell, there will be solicitors fees, removal fees and estate agents fees to pay, along with fees for letting agents & a deposit for a rented house. If you rent, you might have to move at short notice if the landlord decides to give you notice to leave - although you might be effectively renting from the bank, as long as you are paying the mortgage on time, you can stay where you are. Once your debt management plan finishes, your credit score will still be rubbish for another few years afterwards, so you might find it difficult to get another mortgage at a decent rate. If interest rates do go up in the future, you could always decide to sell at that point.

Don't rush into a decision.

madeupname1

tyllwyd wrote: »

On the other hand, if prices stay the same or rise selling now might make it very difficult to buy back later. If you sell, there will be solicitors fees, removal fees and estate agents fees to pay, along with fees for letting agents & a deposit for a rented house. If you rent, you might have to move at short notice if the landlord decides to give you notice to leave - although you might be effectively renting from the bank, as long as you are paying the mortgage on time, you can stay where you are. Once your debt management plan finishes, your credit score will still be rubbish for another few years afterwards, so you might find it difficult to get another mortgage at a decent rate. If interest rates do go up in the future, you could always decide to sell at that point.

Don't rush into a decision.

And don't forget that rents can vary widely. I am a landlord with a property that is rented out and the achievable market price has varied by £350 per month, possibly more ...

Jojo1daffy

I have just sold my house to clear off all my debts and I'm going to be going into a rented house with my 2 children sometime very soon. I have had a mortgage for 18 years and it's been a rope around my neck, the roof is starting to need replacing, windows need replacing - I'm very happily going to let someone else deal with all that nonsense. I'm going into a fully refurbished house with a new kitchen and bathroom and I can't wait.
Oh and I passed the credit check for the rental agency (which isn't a credit check as such - it checks for bankruptcy and CCJs [public information] - not sure a debt management plan would feature..?).
The best of luck to you in whatever you decide to do.

cannegan

Thanks so much for all the advice. Of course, the advice varies greatly so I'm still very unsure, but at least I'm armed with some more views on the matter. I must admit, I'd be happy not to have to worry about maintenance anymore! And I don't mind moving every six months. If it was up to me, we'd live in a campervan while we paid off our debts but the wife needs somewhere to plug her hairdryer in

Anyway, still not sure what to do. We're having the house valued tomorrow so that may sway my mind one way or the other. As for renting, we could get a guarantor (sp?). But I understand the costs are hefty for moving. On this point, we aim to sell the house at some point, so does it really matter when? It leaves us free to buy again in a few years time without having to pay the costs then....

Thanks again everyone.