Dilemma-no equity, but need a new mortgage deal

andybartliff

I am separated from my wife and will divorce eventually. We have a £142,000 mortgage for a £160,000 house. My wife wants to be removed from the mortgage and deeds, to enable her to possibly claim housing support/benefit. The mortgage lender-'first active'-need me to make a new application for a new mortgage, based on the new circumstances.I doubt that I will receive a realistic new quote, given the current value and the amount of the debt. I have no savings.
I have been making the mortgage repayments alone for several years.
The whole matter is very much complicated by the fact that I/we have been renting the house out for the last three and a half years, initially with the consent of 'first active'.
The house has been occupied by three sets of tenants over that time and is currently let to a couple who seem indefinitely content, but who knows.
With the 'sales' market as it is - Leeds LS18-I cannot imagine a quick or profitable sale, although I am prepared to sell.
Any suggestions as to my best option ?

silvercar

If the property is let, your wife's ability to claim benefits will be reduced by the income she receives from the tenants.

With the tenants in situ, the options are to remortgage on a BTL mortgage, difficult with low equity or see if the lender will release your wife from the mortgage. This will depend on your income. Do you still have CTL? If not, the lender will ask questions.

Selling up may be your only realistic option.

sarahevie

Strong rental area though LS18 horsforth, good for rail links harrogate, york, leeds.

Plus lots of students in the area TASC. Houses do seem to be selling in the area, I live down the road in LS20 so know it very very well.

It's frustrating but I'd be tempted to keep it let (if you can get lender permission) seems the best bet. Or sell it. Wiping out any remaining equity but ridding you of the burden and ties with the ex.

poppy10_2

You'll need to take out a buy to let mortgage, which will be at a higher rate. If your consent to let has expired and you are still renting it out, you are essentially committing fraud -

DVardysShadow

Sell it. You don't need it to live in. It stands in the way of your ex-wife to be getting her housing sorted. You are going to have to jump through all sorts of hoops to keep it. It looks like an albatross around your neck.