Negative equity

SarahFx

We bought this house three years ago and borrowed against it to do it up to a liveable condition. We have an interest only mortgage so haven't paid any of the capital off and now reckon it would fetch about the same amount as our outstanding mortgage.

I know we've been stupid. We have no savings or anyone to borrow from and about £7k on credit cards. We need to move now as I am pregnant and this house is not at all suitable for a baby.

As we have no equity we have no deposit to put down on a bigger house. All I can think of doing is selling this house and hoping that the purchase price covers the mortgage then renting somewhere until we get ourselves sorted then hopefully qualifying for a 100% mortgage or some sort of first time buyers incentive to buy ourselves another property.

Does this seem like the best idea or can you think of anything else?

CB1979_2

why is the house unsuitable for a baby?

surely initially all you need is a 4ft X 3ft space for a cot???

also why have you no equity? surley you've done the place up + house prices rises you should have something to put down on another property?

if you can't afford it, is another matter entirely.

maninthestreet

How much did you pay for the house, and how much extra borrowing on top of what you paid?

SarahFx

It's the parking situation not the house that makes it unsuitable for a baby. I have to park quite far away and walk through a dodgy area do don't fancy that with a baby and all the equipment, not to mention if I had shopping with me.

We paid £60k for the house and borrowed £30k for a complete refurbishment including wiring, underpinning the foundations etc etc. The three estate agents I have asked for a valuation from say we are looking at 91k tops. House prices have dropped in our area from a high two years ago.

We could afford a bigger mortgage as my H has just got a much better paying job so affording it isn't the problem.

Bestthingsinlifearefree

Congrats on the pregnancy !! Sounds like the nesting / mothering instinct is taking hold nicely :T

one option could be to rent out the house and then rent some where else for yourselves.

If you do sell the house check there are no mortgage redemption penalties in your mortgage agreement.

what about renting a parking space nearer by ?

what about selling the car and using taxis / buses for a bit?

It sounds like you are in debt why not go to the debt free forum and post a statement of affairs (SOA) so peopke can advise on your overall situation.

Has the property really got no parking close by ? Could you park on a neighbours drive and pay them some cash.

How have you been managing so far ? Are you at the moment parking far away and walking through a dodgy area with your shopping?

I wish you well.

SarahFx

Bestthingsinlifearefree wrote: »

Congrats on the pregnancy !! Sounds like the nesting / mothering instinct is taking hold nicely :T

one option could be to rent out the house and then rent some where else for yourselves.

If you do sell the house check there are no mortgage redemption penalties in your mortgage agreement.

what about renting a parking space nearer by ?

what about selling the car amd use taxis / buses for a bit?

It sounds like you are in debt why not go to the debt free forum and post a statement of affairs (SOA) so peopke can advise on your overall situation.


Has the property really got no parking close by ?

I wish you well.

Thanks, I am desperately trying to get most of our debt paid off before the baby comes along. My H is terrible with money so it's all up to me.

There is parking in the street but unfortunately the other residents cars have almost permanent residence so I am lucky if I get parked once a fortnight. There are no garages nearby.

Our mortgage tie in period is up in August so hopefully we wouldn't get charged.

Renting our place out would be a good idea actually. I hadn't thought of that. Would have to ask our mortgage company I suppose.

Wannabesaver_4

All i would say is remember that estate agents dont know everything - i sold my house for £10k more than the valuation because i felt i knew better and i was right!

SarahFx

Bestthingsinlifearefree (what a long username!!):o At the moment I would pull into the street and drop my shopping off then go elsewhere to park but I couldn't just dump a baby in the hall for ten minutes!

The neighbours mostly have drives but like to park in the street so we could just do with moving on. They aren't very nice people.

SarahFx

Wannabesaver wrote: »

All i would say is remember that estate agents dont know everything - i sold my house for £10k more than the valuation because i felt i knew better and i was right!

Really? Wow I've never heard of that happening before! I suppose we could have a try on putting an extra couple of grand onto the price. The type of house we'd like to buy is around £110k so we could maybe get away with a 6k deposit.

Bestthingsinlifearefree

SarahFx wrote: »

Bestthingsinlifearefree (what a long username!!):o At the moment I would pull into the street and drop my shopping off then go elsewhere to park but I couldn't just dump a baby in the hall for ten minutes!

The neighbours mostly have drives but like to park in the street so we could just do with moving on. They aren't very nice people.

Why not sell and rent in a nice area? At the moment you tend to get more for your money by renting.

Enjoy your new baby, save some moeny so next time you buy you can put down a deposit and get a capital and interest repayment mortgage.

After all if prices have fallen in your area for 2 years. Why buy again if they are falling?

Good luck with pregnancy. It is an amazing journey. Our little lad is 6 months old and he is hardwork but fantastic.

Zammo

And there was me thinking house prices only ever went up.

:rotfl: