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Brink of break down. Need to move but have negative equity & no savings :-(

Im in some desperate need of help/advice.

We bought our new 1st home in Nov 2006.

We live in a 1 bedroom top floor apartment.

We are now expecting our 1st Child in January 2013.

We are desperate to move to get at least another bedroom but we massive problem with negative equity. our mortgage advisor set up a mortgage for £120000 & personnel loan for £17000 all with Northern Rock to purchase our place for £135000 in 2006

Now we have just cleared all our credit cards & loans so have no savings & currently our place is only worth £110000.

Mortgage with NRAM now & have called & emailed on several occasions but waiting to hear back.

I'm on the verge of going crazy as feel & putting a big stress on all of us,we are stuck in a massive rut & see no end to it.

Any1 offer any advice?

Thanks

Comments

  • beecher2
    beecher2 Posts: 3,677 Forumite
    Tenth Anniversary 1,000 Posts Combo Breaker
    Now that you've cleared your debts, focus on overpaying. The baby will be fine in a one bed flat for a while so try not to get stressed out. If you need help with budgeting, post a Statement of Affairs on Debt Free Wannabee to get help in order to put every spare penny towards overpaying.
  • Jimbo1976
    Jimbo1976 Posts: 498 Forumite
    Wait and see what NRAM say. Depending on what the value is of the new home lenders do try to accomodate borrowers with negative equity moving home.
  • Thanks for the info.

    Staying put is the only option I know, but at somepoint will HAVE to move within the next 2 years, but to move out & buy some where else & clear the negative equity we are going to need about £40000 & to save this would take us around 5-6 years.

    Jimbo1976 - Really what can they do to help though??

    Honestly going out of mind trying to think of things to do get earn some extra cash etc.
    I already work stupid hours to impress the boss's, I have thought about getting an evening job & weekend, but fear I will burn my self out & have no life at all.
  • Jimbo1976
    Jimbo1976 Posts: 498 Forumite
    If you can find somewhere bigger but the same value as your flat then NRAM will look at you moving your loan from your flat to a new home. Thats about as far as a lender can go to help.

    Do you live in a city centre now? Can you find somewhere a bit more rural thats bigger?
  • princessdon
    princessdon Posts: 6,902 Forumite
    What is the social housing like where you live?

    Is renting your appt out an option and moving into a 2 bed rented?
  • ILW
    ILW Posts: 18,333 Forumite
    What is the big problem with a 1 bedder and a small child?
    Many cope just fine.
  • Are you sure Jimbo?
    I dont think NRAM even do mortgages anymore?
    Jimbo1976 wrote: »
    If you can find somewhere bigger but the same value as your flat then NRAM will look at you moving your loan from your flat to a new home. Thats about as far as a lender can go to help.

    Do you live in a city centre now? Can you find somewhere a bit more rural thats bigger?
  • laurel7172
    laurel7172 Posts: 2,071 Forumite
    I know it deprives you of decorating a nursery etc, but your baby will be fine in a one bed flat. And if you're still stuck there in a couple of years, you could always put a fold-out bed in the living room for yourselves.

    There probably isn't a quick answer, I'm afraid. It took us seven years to save our way out of the negative equity on our first home, while interest rates on mortgages were as high as 15%. On the upside, our next home was much cheaper than it would have been otherwise...there will be an end to the nightmare, no matter how dark it seems now. Good luck.
    import this
  • Nram wouldnt lend us any more money when we wanted to buy a bigger house recently, In the end they told us they wont lend us more but if we move mortgages our loan shoots up to 12.5% and at 22k thats a lot, £250 a month on top of new mortgage. Trying to find a way of settling this. I would suggest staying put for the time being, Nram are no help at all im afraid.
  • Try not to get too stressed we lived in a tiny 1 bed flat with stairs until dd was 2 1/2 she slept in our hall in a cot for 1st 2 years, things change in our lives all the time and in 2 -3 years things can change alot. What happened to me well we moved into a house which we still live in and that little flat well its still ours.

    When I remember back I sometimes felt we would never move lots of saving and juggling the flat contents around to make room, went back to work when DD was 9 weeks old (very limited Maternity pay then) and saved, life then was exhausting but enjoyable.
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