Negative Equity Property & Struggling to Manage

silvercar

could you increase the mortgage on the place you live in, to put some equity into the BTL?

the only other way I can think of is to get a loan (credit card?) to borrow money elsewhere to enable you to reduce the rate of your mortgage. eg if you can borrow £20,000 at 10%, but this then means you can reduce the BTL mortgage from 7.5% to 5.5% it will cost less overall.

the only other suggestion I have is to find a second income, so that you can pay down the mortgage as soon as possible. difficult I know.

If you find that the money your getting in rent is so much less than the mortgage, would it be better to cut your losses and sell it. OK you are hit for £20,000, but how much money are you losing each month? and when you factor in maintenance, how much is the flat costing you?

irnbru_2

Krish wrote:

All I need now is to hang around for few more years and atleast break even

You're not being realistic:

• What happens if your tennant leaves?
• What happens if interest rates rise?

Have you considered selling your existing property and downsizing?

tara747

mpsavuk wrote:

I can't understand it. I thought property only ever goes up in value?

Surely you can't loose if you've invested in bricks & mortar?

Are you joking?????

tara747

mpsavuk wrote:

Ok, explain it to me then if you are so clever.

Renting is dead money so it's always best to buy.

Prices are going to keep rising so best to buy before you get priced out.

The media say prices will be going up 10% this year and 12% the year after.

You can't loose if you get on the property ladder, even with an interest only mortgage.

This is pure comedy.

:rotfl:

roswell

mpsavuk wrote:

Ok, explain it to me then if you are so clever.

Renting is dead money so it's always best to buy. Only if it isnt cheaper to rent

Prices are going to keep rising so best to buy before you get priced out. Priced out of what ? if you cant afford it now you wont be able to afford it if the price riases unless you have a way to magic more income

The media say prices will be going up 10% this year and 12% the year after. The media also said everyone and there sdog should purchase technology shares in 2001 .. what happened in 2002?? Did the media tell you that ?

You can't loose if you get on the property ladder, even with an interest only mortgage.You can if that mortgage payment is more than your income or the propery is repossed sold off for 50% of what you paid for it and you still owe the bank the remaining 50%

Before anyone says my post is doom mongering or pro crash or 7 pages or house price crash 99 this post is purely an ovjective opinion on why the info above could be wrong.

To the original op,

If it is as bad as you say 300 properties all in negative equity id be tempted to sell up and take the loss after all a £20 000 debt is better than a £40 000 debt, if you dont see the market improving in the short term and your struggleing theres no point digging a deaper hole.

irnbru_2

roswell wrote:

Before anyone says my post is doom mongering or pro crash or 7 pages or house price crash 99 this post is purely an ovjective opinion on why the info above could be wrong

Err, I think mpsavuk is being sarcastic.

HankMcSpank

Let me see if I've got this right....

You've overpaid for a place (sorry to break the news, but the 5% gift the builder gave you...well, he gave even more to everyone else! This is to keep the sale price artificially at the one level so as not to unnerve new buyers)

At a poor mortgage rate

You can't make up the rent shortfall to cover the mortgage

You can't remortage cos it's tumbled in value

You can't sell up cos it's tumbled in value

Best get the keys cast in bronze as a keepsake coz they're not gonna be in your possession you much longer. You also need to get in touch with Kirsty & Phil & ask them how this could be?

Amitoocautious

The flat isnt in Basingstoke is it?

I think this post shows that what the VIs make us believe in that propety can only go up isnt always true. I feel sorry for you and i dont know what to suggest short of selling it and taking the hit!

tara747

I agree with Amitoocautious - Krish (the OP) should sell up now and avoid making an even bigger loss. I feel a bit sorry for Krish but even more sorry for whoever buys the place from him/her - a flat that's losing its value. Scary!!!

King_Of_Fools

Krish, I would be seriously worried about the house falling further in value over the next few years. House prices started to crash in USA about 6 months ago now they are falling in Ireland so it will not be long before they reach us in the UK!