Help with my mortgage please!

superfly_2

Hi,
I have a bit of a problem with my current mortgage situation and am looking for some advice please.
We bought our house 4 years ago and
got a 110% mortgage from BMS (bad move) the house cost 115000 which was broken down to 100000 mortgage and 30,000 unsecured loan.
We have now outgrown the house(family getting bigger), and would like to move on.But prices have fallen and we would be lucky to get 100000 for our house, leaving us with the unsecured loan.

We could probably manage this as it is currently at 2.59% but if we pay off the mortgage the rate jumps to 10% var. which we could not manage on top of the new mortgage.(its also over 30 years!!)

We have good credit and could probably afford reasonable monthly payments but are there any lenders who will take this on.

Cant ask family as they are already helping with the deposit for the new place.

Any suggestions welcome.

hillcats

Possible negative equity and a huge loan outstanding, I dont think you will be able to remortgage or move - sorry !

Thrugelmir

superfly wrote: »

Hi,
I have a bit of a problem with my current mortgage situation and am looking for some advice please.
We bought our house 4 years ago and
got a 110% mortgage from BMS (bad move) the house cost 115000 which was broken down to 100000 mortgage and 30,000 unsecured loan.
We have now outgrown the house(family getting bigger), and would like to move on.But prices have fallen and we would be lucky to get 100000 for our house, leaving us with the unsecured loan.

We could probably manage this as it is currently at 2.59% but if we pay off the mortgage the rate jumps to 10% var. which we could not manage on top of the new mortgage.(its also over 30 years!!)

We have good credit and could probably afford reasonable monthly payments but are there any lenders who will take this on.

Cant ask family as they are already helping with the deposit for the new place.

Any suggestions welcome.

As interest rates are low you need to start overpaying the unsecured loan to clear it quicker.

There's no quick answer to your problem.

In the current mortgage market you wouldn't be in a position to buy a house at all. Times have moved on from 4 years ago.

superfly_2

So, if I have to bide my time, am i better to overpay into the unsecured loan or start saving in a isa or savings account?

xyellowx

you are best part of 30k in debt and in negative equity aswell on your house, you are borrowing money for the deposit then there are the fees on top for moving,
you need to smell the coffee before you get into a posisition were you could lose everything

Thrugelmir

superfly wrote: »

So, if I have to bide my time, am i better to overpay into the unsecured loan or start saving in a isa or savings account?

Overpaying the secured loan may be the best option. As its a visible objective. That you'll see reduce over time. By overpaying there's no possibility of using the cash for another purpose. The differential between the mortgage and a cash ISA is minimal. Taking into account the fact the mortgage interest is charged monthly.

Meeper

If family were going to provide the deposit money, perhaps they could provide funds to extend your current property instead of pay for a loft conversion, etc?