moving home! is it possible as we are in a 80/20 mortgage

aimzoliz

Hi. This is all very confusing to me but i will try and explain as well as i can in thehope that someone can help.
We bought a new barratt home almost 2 years ago. We were first time buyers and took advantage of a 80/20 deal they were offering. By which we had a normal mortgage for 80% of the house price and a loan from the builders for the remaining amount minus a 5% deposit we paid. This loan is due to be paid back by the 10th yr of owning the house or when we sell...which the builder woild recieve 20% value of the house back. We recently had a 3rd child and this house is now too small for our needs and we really need to move. But i cant see a way of being able to move when we are under this scheme. Can anyone offer any advice on how we can move.
Ill also add that our house is valued at £ 30,000 less than what it was as new

Thrugelmir

aimzoliz wrote: »

But i cant see a way of being able to move when we are under this scheme. Can anyone offer any advice on how we can move.

Could you afford a home like this without the scheme?

What you need to do is either save more or overpay the mortgage. As you need to build equity which can be injected in the property you wish to buy.

bigadaj

It's a useful cautionary tale for others on potential co sequences of such schemes, as thrug says all you can do is try and save hard.

kingstreet

To be honest, the problem here is trying to sell a newbuild in the short-term. The property is worth less, as the newbuild premium has dropped off.

The borrower put down only a 5% deposit and that would have been the same with, or without, the equity loan.

I can't see an easy short-term solution. Reducing the outstanding mortgage as quickly as possible appears the only answer.