Selling up and Renting

Elloyd

Hi Folks

I was just wondering your opinions... Basically, we own out own house now, but seem to be living each day as it comes with money, some days not being able to afford even petrol to get to work... Its one HUGE struggle to get through life at the moment. We have a DMP running, which has been a god send, but even with that life is tough.
We was thinking of just selling up, paying our debts, but then having to rent, just to make life more enjoyable with the extra money we will have each month, and no debt problems.
Do you think selling up just to get a better way of life is worth losing the house for, or do you all think we should just hold tight and try and get through it.
All opinions welcome.. :j

Werdnal

You need to do the sums to see if you would really be better off. You may be able to pay of your debts and start again, but the outgoings of renting are still high. Are you looking to rent privately? If so, you may find monthly rent would be more than you can afford. Have you researched the market in your area to find out what the going rate is for private rentals?

You would also not have the long term security of the property, ie after the expiry of the fixed term let, you could find yourself evicted - LL does not have to give any reason and even if you are the ideal, reliable, trustworthy tenants, a LL can give you 2 months notice to take possession, and you could find yourself leading a very nomadic lifestyle - would that suit you? This also means credit checks and references each time you move to a new property, which you have to pay for, and if you have any debt history, this may show up in your checks and make LL wary of letting to you.

Is there any way you can downsize the property to release some of the equity to clear your debts, by buying something smaller, cheaper area etc?

My friend did exactly what you are proposing, and downsized to mobile home situated on another friend's farm, for a peppercorn rent, which worked for her. However, if you are stuggling to meet your outgoings now, they may not be any less in a rented property, as it seems its actually the cost of living that is crippling you, rather than owning your property. Paying off the debts now is fine, but how long before they would build up again - with the added stress of trying to find rent every month?

Would you also be prepared to be "forever" renters? Once you step off the property ladder, it is very hard to get back on the bottom rung again!