Need to sell even with negative equity

cmc090

HI, never posted before so here goes.

Myself & my husband were living to my husbands overtime, when, as you've guessed it stopped. We have taken huge steps already by returning our car & have come to arrangements with those we owe money too. We have learnt alot of valuable & much needed lessons. We have cancelled our Sky TV & reduced our internet use. However. Even though we are getting through it VERY slowly we really want to sell & get ourselves to a place where we can start a fresh. Our problem is that we are in negative equity. Can anyone tell me what happens in this situation. Can you pay off the outstanding over a period of time or do we need it all in full. I'm scared to contact them as things have been so difficult.

I know to some I may sound silly but, I'm genuinely not sure what to do.

Thank's in advance

getmore4less

is the cost of alternative accomodation and paying off the negative equity cheaper than keeping the mortgage?

Thrugelmir

Is your mortgage interest only or on a repayment basis?

holly_hobby

Who is your mortgage lender ?

Not a Northern Rock together mortgage is it ?

H

Wizzle_Tweakly

What if it is Northern Rock?

jimjames

If you can now afford the mortgage you may be better off staying put.

If you move you will have to take out a loan for the negative equity plus your selling costs if you have no savings. You will then have no deposit or money to use for the costs of getting a new place.

Prices will increase again long term and negative equity will eventually disappear. If you can pay down the mortgage then you will be in a far better situation than paying out costs for something you may not need to do.

Our house was in negative equity in early 1990s (my wife bought in 1989 right at the peak), we didn't sell but kept it until the value had risen sufficiently. If we'd kept it a few more years it would have more than doubled even with the current price drops.

pentland

Wizzle_Tweakly wrote: »

What if it is Northern Rock?

I think the concern, if it is a Northern Rock Together Mortgage is as follows:

If you hold a Northern Rock Together Mortgage and decide to sell, then the unsecured part of the loan increases significantly to over 12% from around 4.7 (NR's Standard Variable Rate)

As a NR Together Mortgage holder and looking to sell, although I'm not quite in negative equity, I would still be left with the unsecured amount to pay off over the remaining 20 years of my term.

Just to put that into perspective, my initial unsecured loan was 20K yet I would have to continue paying £236 per month for the remaining 20 year term on my mortgage! So I calculated that at the end of that 20 year period and taking into account payments I already made over the 5 years of my fixed period, I would have paid back in toal over 60K!

I think that highlights the concern of a Together Mortgage and I've since reviewed my decision to sell up.