Joint Mortgage/Split/Concerned about growing debt

widget81

Hi, i'm sure this has been posted before however I have certain variants on the issue at hand, so any ideas or advice would be most welcome.
My ex and myself bought a property and got a mortgage for £125,000, (the house was purchased for £145,000).
We split and since a long period defaulted on the mortgage. We are now in arrears of, currently, £137,000. She is willing to sign the property over to me, where I will move back into the house and take up the payments and the burden of the outstanding debt.
I have been living in rental accomodation paying £1000 per month and my income is around £25k. Although I can show that I can pay the current rent rate it is in my view unlikely that I would be approved of a mortgage.
As a side issue, I have, since the split, inherited a property jointly with my sister, which has been paid for outright, which is worth £200k+. This figure is irrelevant as selling is not an option. However would it benifit my application by mentioning this other property, or may the bank try to seize this to cover their monies owed?
At present the interest is motoring up daily and I am making a proposal that I want to take control of this increasing debt, however if the bank feel that I don't earn enough where does that leave me/us(ex inclusive) with this figure that is soon going to get seriously out of control.
I do not wish to borrow further funds I just want to pay back!
I hope I have explained this in an understandable manner; Thank you for you time.

ACG

On £25k you wont get a mortgage of £137k

I think your only real option here is to sell or rent the property out. But if your looking to cut all ties together i think the only option is to sell.

widget81

We just tried selling the property and the market has reduced the figure to £132,000. Although since prospective buyers have been told by the banks/surveyors that the house is a "builders project"; My ex was living in the property comfortably 3 months ago.

Having felt that a sale is going to leave a rather large debt I have decided that this proposal would at least return some of the outstanding on the mortgage.

Would the existence of the other property have any effect with an application or could they muscle on this property to demand equity for the outstanding debt?

ACG

well, in theory if the house were to sell for less than is owed they could potentially look to get the money from other belongings you have, however for the figure you mention its probably unlikely.

I dont think you have much of an option here if your looking to cut all ties together.

widget81

At present the bank are unaware about the existence of the other property. If this was mentioned in my application would it benefit the proposal do you think or, as i suspect, would they simply refuse the application on the fair standing that I don't earn enough or am a risk and then yoink!! attack the inherited property?

ACG

If your income supported the loan your after than there could be ways and means. Your income though doesnt support the loan you want so its a waste of time even considering it. I also wouldnt even mention the other property to them.

Its very unlikely they would try to do anything with the other property, but why give them the opportunity to even consider it.

DVardysShadow

The sane thing to do is move back into the property, curtail your £1000/month outgoings on rent and put the money to the mortgage. I cannot see why you have to agree a deal with your ex to do that. If this is something your ex is insisting on, she needs to be disabused of the idea and recognise that there is no point in bringing you down unless you take over the house and the debt, because if you go down, she comes down with you.

It is as plain as a pikestaff that you will not be given a mortgage on your own while there is so much debt [not £137,000 arrears!!! more like £137,000 debt of which probably £15,000 is arrears].

Just to complete the picture, what is happening with the other property? If you cannot sell this, it should be put to work and paying something to you.

star4876

shoot me down in flames if this is a stupid question but if you've defaulted on the mortgage for such a long time how on earth have you managed to keep the house anyway? I'm surprised it hasn't been reposessed already. You must be a very convincing customer...

paying £1000 a month in rent on your salary is devastating, after CTax you would only have about £350 left over to live on? Unless you have no car, transport, utilities to pay for... that sounds like a struggle. :-\ judging by those figures I'm guessing that you haven't got a deposit to assist a remortgage!

Youre contracted with your mortgage lender to pay that mortgage youve already got, that house belongs to you (regardless of your ex) so realistically you should get out of the rented accommodation and move back into your own house. If your ex wanted to resolve herself of the mortgage responsibility she should have kept up the repayments and negotiated a TofE when you weren't in arrears. I would, to be frank, ignore that for now.

So forgetting her, why don't you move back in and rent a room out? Assuming your mortgage repayments are not £1,000+ a month, a bit of extra income could help to pull you out of the arrears and then actually give you some options , other than voluntary repo.

with regards your other property asset, don't tell anybody who doesn't need to know about it. If selling is not an option can't your sister buy you out? Assume you have relatives living there which is why it cant be sold? could you rent it out?