Negative equity and wanting to sell

jeagle

Hello all

I bought a house with my sister four years ago (at the height of the market). We got a mortgage with Northern Rock who offered us over 100% to cover the cost of the house, the deposit, the fees and some money to do it up!

The house is now worth about £150k (max £155k if we're really lucky) but the outstanding mortgage is still £158k.

We are both now in relationships and want to go our separate ways but don't want to be left paying the shortfall AND the fees on top!

Any advice?

opinions4u

jeagle wrote: »

We are both now in relationships and want to go our separate ways but don't want to be left paying the shortfall AND the fees on top!

Who do you think should pay it for you instead?

Any advice?

Talk to Northern Rock and ask what schemes, if any, they have in place to allow you to repay the shortfall after sale. Ask the key question about how it will affect your credit ratings.

hcb42

you are going to have to pay it I am afraid, otherwise you will need to sit it out and pay the mortgage until property values rise again....

holly_hobby

On the old NR 125% LTV mges (marketed at the time as a "Together Mortgage") - 95% of the LTR was classed as a mge & secured on the property, with anything up and above this figure in essence treated as a form of personal loan, albeit on the same rate as the mge itself.

Now, upon redemption, if the total borrowing above the 95%, couldn't be cleared, the original NR solution was that the remainder up and over the orig mge amount was convered to SVR & a loading, and from therein treated as a standalone personal loan.

Now I know since then, there has been a lot of changes to NR !! But, have a look at your mortgage t&cs - there may be something in there covering this. Failing this, have a chat with them ...

The question is whether it would be transferred to a joint loan i.e reflective of the individuals party to the mge - or if you could elect to just have it in one name.

Hope this helps

Holly