Advice Needed, Sell up and rent! Massive debt

roxy84

Hiya, new to this and after some friendly advice.
Dont really know how to start but here goes:

My boyfriend and i are seriously in debt, so far as i can tell it goes something like

Mortgage £156000
Secured Loan £14000
Unsecured Loan £26845 (Northern Rock together mortgage previous house)
Other loans £48731
Credit Cards £1008
Store Cards £649

New combined wages are £62000 gross

We have a mortgage arrears of £3111.81 and are getting taken to court to get a reposession order put against us, this is due to me leaving work last year as i had a baby in september and my partner couldnt afford the £950 a month payments, these increase to £1080 a month in december on top of everything else. I now have a new job and start on monday to try get us out of the mess my partner has got us in. Would it be best to sell our house now, valued at £187000 we would only be left with about £3000 after all the fees but we would of cleared the arrears and £170000 of our debt and just find a property to rent. We have really bad credit, my partner has a CCJ and we both have various defaults on lots of our accounts so getting a cheaper mortgage would be impossible, so selling up would mean we would have to rent for at least 6 years till our credit was a little better.

Would we be better off selling up and renting?
Would the courts accept a extra monthly payment to pay off our arrears now that i am working?

This is putting a real strain on our relationship, we are fighting over this everday and iv even thought about leaving my partner and moving back to my mams with the baby, which i do not want to do.

Any advice would be gratefully appreciated

airforce_beret

thats a tough one roxy, to me ... common sense would say sell up and rent and get yourselves back on your feet....BUT...easy for me to say that from a distance when you two are the ones in the relationship and now with a baby too. I'm sure that deep down you both know what you need to do. It's hard enough getting on the property market without selling and then renting but if it helps you in the long run then maybe that is the way forwards for yourselves.

each situation is different and I can only wish you luck with whatever you decide

jcr16

sending u big hugs. didn't want to read and run.

best thing to do is post a SOA ( state of affairs) then other members on board can give u more advice.

fatbelly

If you can convince the judge that you can now afford the contractual monthly instalment (cmi) plus something towards the arrears (try £50 per month) then he/she should award a suspended possession order, which means that you stay in the property as long as you can keep up the cmi + 50 payments.

Selling up may still be the best solution (we'd need an full SoA) but at least that would buy you some time to make sure you got the full market price for the place.

chunky79

Also didn't want to look and run either hun, Chin up x

I agree put up your SOA.

roxy84

thanks for your comments guys.

I was going to offer the judge about £250 a month on top of the payments to clear the arrears, i could also borrow £500 off my parents to put towards it if this would help. I dont know anything about the process of reposession so wasnt sure if this would go down well or not.

Thanx

silkglade

roxy84 wrote: »

Hiya, new to this and after some friendly advice.
Dont really know how to start but here goes:

this is due to me leaving work last year as i had a baby in september and my partner couldnt afford the £950 a month payments, these increase to £1080 a month in december on top of everything else.

I now have a new job and start on monday to try get us out of the mess my partner has got us in.

Any advice would be gratefully appreciated

HUGE HUG TO YOU AND WELCOME

Hi Hun, Can I first say that I am concerned about the fact you say that your fighting every day, 1st thing is that you are in this together and no matter how bad things get you still have each other to turn to and depend on.

Hubby and I have been to hell and back, but you know we got through it and will get through anything together as we know that no matter what we are always there for each other.

Yes you are in alot of debt, but you know life is too short and if you post a SOA then we can try to start giving you advice.

I am also worried about the fact you (as I did) gave up work to have your baby, yet you have in this post blamed your boyfriend for your situation at the moment.

Fair enough to blame him if he is wasting money, ie gambling or having expensive spending spree's on credit cards, but if it's just the fact he does not earn enough then I think it's a little harsh.

You are a family now and nothing is more important than family you love

Sorry if I have not been any help

gazmondo_2

Hi Roxy684,

This is my first post so I am not sure how good the advice is going to be but from my prespective I would be looking at things like this:

debt 240000K
equity 31000K (house price inflation)

If you sold your house that would leave a debt of approx 53K. The gamble to me is how house prices are going to adjust in the next couple of years, if you think they are going to go up, and can afford to meet the interest/debt clearance payments then it may be worth keeping the house. However, the market appears to be topping (depending on the area) so there may be a price adjustment downwards ( but that is purely a personal opionion). There is also the home vs rent (not your home argument). However, looking at your mortgage I would have thought that, if you decide to sell, you would be able to get an equivalent property for a cheaper rental value.

Not sure if this helps but good luck :-) not worked out how to do the icons !
I have not worked out how to use the icons but good luck ... :-)

silkglade

roxy84 wrote: »

thanks for your comments guys.

I was going to offer the judge about £250 a month on top of the payments to clear the arrears, i could also borrow £500 off my parents to put towards it if this would help. I dont know anything about the process of reposession so wasnt sure if this would go down well or not.

Thanx

All I would say is make sure it is an amount that you can easily afford, you don't need more stress by giving an amount that you have to struggle for. you could always say that you can afford X amount every month and if and when you will make additional payments until the arrears are gone

Sarahwx

you are young and renting is not a bad thing, sounds like your income for your age is very good so should be going up and that means a positive future for you.
make sure that rental prices are not higher than your mortgage before you take the jump- it has got to be worth it.
most important must be relieving stress in your family and feeling that you can enjoy life and your baby.
Good Luck, I hope it works out x

mrs-d_3

Hi Roxy84,
just wanted to say good luck and be strong. See if you can hold on to the house but if not you are still very young and renting for a while wouldn't be too bad. I know it puts a lot of strain on your relationship and having a baby makes it harder ( I have a 6mth old ) but you are in this together. You need to work as a team, sit down a work out whats the best solution without blaming each other. Whats done its done try and learn from it. Remember nobody's perfect.
.:grouphug: