All advice welcome

sugar_plum_2

This is my very first thread on money saving expert. I have read many of the other threads and Im eager to hear any suggestions on my situation.

I am a single parent of an eight year old and I have recently gone part time after seven years of working full time. I brought my property 6 years ago and my mortgage was for £34,000. The outstanding amount to date is £31.025 including any redemption fees.

My property has been up for sale since the first week in April. I had three different estate agents come out to value it. It was orginally put on the market for £82.000. I had a few visits but no offers, there are also three or four other property's just like mine for sale in my block (which doesnt help).

Last week I dropped the price to £79,950. I am so desperate to move so I am able to have a garden. I have even looked into organisation's who will buy your property off you and everything will be completed in about two weeks but the down side of them is that they offer about 20% below the valuation quote, so im not to sure about that option.

Im sorry that all this is so long but I want to make sure I include everything. My annual income is £15,401.80

If I sell my property for £79,950
Pay back £31,025
Estate agents fee £1,800
Clear debts £5,743
Solicitors fee,
valuation £1000

I am left with £40,382. Even if I put all that down as a deposit I would still have to have a mortgage for about £70,000 to £80,000. Making my repayments each month about £450. I have been looking into 'part buy - part rent' as you are able to buy upto 70% of the house and I could then pay rent for the first three years on the remaining 30%.

Im really unsure what to do for the best . Should I just be patient with the sale of my property ?? and is 'part buy- part rent' an option I should consider ???

I would really be grateful of any suggestions.
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Halifax overdraft £1060.35 + Halifax c/c £2027.77 + Capital One c/c £879.84 + Dorothy Perkins £997.32 + Hsbc c/c £461.93 + Halifax loan £316.42
Proud to be dealing with my debts !!!

vansboy

Hi Sugar Plum!

From what you say (& mentioning the £$£$ you owe), I'd think you'd be in a far better situation, if you thought about renting a house, once you do sell the flat.

From the figures you show, it sure looks like a LOT of hard work, to make it add up to enough for mortgage & all other living expenses.

I'm a firm believer in owning your own home, but it'd certainly make things at bit less of a drain on your income, if you found an OK house to rent.

Don't go down the route of heavy discounts, to sell though - that would be unwise & not really get you anywhere.

Guess it's just a case of waiting for it to sell, assuming it looks as good as it can & is priced right (not too dear & not too cheap)!

VB

Doozergirl

Hi Sugar Plum,

By your signature I think you've been lurking for a while . Congrats on your first post.

Your estate agent fee is very high! How long have you been on the market? I think you should try another agent and negotiate on the fee this time. you should be looking for 1% plus VAT or you could use an online EA like https://www.housenetwork.co.uk that many of us have used who are even cheaper.

Would you be prepared to post us up a link of your flat on rightmove and we can offer advice on the details and also have a look at comparable properties.

The amount you are looking to borrow as mortgage is a little frightening in comparison to your income. Do you really need to go so much more expensive; would it not be possible to find another flat, with a garden? Or, if you do want to go much bigger, then perhaps renting would be a better option for you. No one wants to see you struggle

See if you can get yourself some 0% cards for the moment and get (particularly) that DP balance shifted to something less expensive. I can't imagine the APR on that!

Mrs_pbradley936

Have you considered the “Rent a Room” scheme? It is where you rent a room to someone in a house that you are buying. It is tax free and can go a long way towards paying your mortgage costs.

Nenen

sugar_plum wrote: »

I am left with £40,382. Even if I put all that down as a deposit I would still have to have a mortgage for about £70,000 to £80,000. Making my repayments each month about £450.

Hi Sugarplum
It sounds as if you are in a tricky situation and I know (from bitter experience) that it is hard to know what to do for the best at a time like this. It's vital that you do all your sums very carefully before you make any decisions.

Where do you get a figure of monthly repayments of £450 on a 70-80,000 mortgage? What kind of mortgage are you looking at?
I'm certainly not an expert on mortgages but I had a quick look at the chelt & glos website and using their online calculatoes on a standard rate repayment mortgage over 25 years your monthly repayments would be £517.29 for the minimum 70K. You can get various fixed rate deals (I found one fixed for 7 years with monthly repayments of £463.50 for 70K) and assisted deals but then you have to pay a large arrangement fee (somewhere between £700 and £1900):eek:

I'm sure some of the mortgage experts on here could point you in the direction of better deals (Northern Rock is often talked about) but I would think it would be unlikely that you would be paying at little as £450 on an 80K mortgage. You then have insurances etc on top of that.

If you are earning £15,401.80, then I guess your take home pay will be less than 1000K per month which would mean that more than half your montly wage would go on mortgage and you'd have less than £500 per month to live on. Have you checked if you are eligible for any tax credits or benefits? Do you get maintenance for your child? The DFW board are very good at advising what is feasible to do.

Whereabouts in the country are you and how easy is it to find rental properties? This might be a really crazy idea but would it work for you to rent your property to someone and use the money to rent somewhere more suitable for your and your child?

Anyway, do all the sums very carefully and good luck with whatever you decided to do.

sugar_plum_2

Thank you all for your advice and suggestions.

After considering everything again I dont think it would be wise of me to take on a higher mortgage.

I quoted the wrong estate agents fee they are charging me £1400 is that still high ? and in reply to swapping my store cards to a 0% card. At the moment all my creditors are not charging me interest and I do recieve everything in entitled to and I dont recieve any maintence for my son.

I have another idea but I need to think it through properly first and then I will be back asking for advice.

Doozergirl

Yes £1400 is still high. You should be looking at 1% which is would be about £938 inclusive of VAT for you. If you used a company like House Network it would come in at less than £500.

I saw your post about letting your flat out. Are you sure about this? What sort of rent would a flat of that value bring in?

sugar_plum_2

I am considering renting my property out. The rent for a property like mine is about 450pcm. My mortgage at the moment is 221 a month. But I also considered re-mortgaging which would take my monthly payments to 307 a month and the rent would still cover that. Is it silly to re-mortgage to do up my property and Im not going to be living here. My current mortgage outstanding is 31,000.00 and I was going to go up to 42,000.00 but not extend the years. Good idea or not ????

sugar_plum_2

I forgot to add, at the moment my property is valued at 80,000.00.(without double glazing or fitted kitchen) its one of those duplex masionettes.