Stay or sell??? Help...

macymoo

Advice needed please, we have a nice house in a good area with good schools but mortgage payments are starting to become a struggle. We have about £11K credit card debt which keps growing. Hubby works full time and I work part time as we have 2 small children.
The quandry is do we sell and pay off debts and still have about £30K in the bank to save / live off for a year or so till both children are at school and I can earn more then re-buy with money saved (if we can afford to)
OR
do we stay and struggle on with increasing debts until we can earn more and keep our house.
Of course no one knows if house prices are going to be more affordable in a year or so but I would feel a lot better emotionally with no debt.
Is it really the best option to own a house???

Doozergirl

Owning a house can't make you happy if you're not happy!

Have you been over to the Debt Free Wannabe board? You really need to address the problem of the debt still growing, otherwise you're going to get yourself back into this situation with no house to sell to bail you out

If you budget hard enough you might be able to keep the house, but hey, it's not the be all and end all.

RAS

Macy

A house is not the end of the world, but at this stage you have far more equity than you have non-mortgage debt. If you bear in mind that the average cost of moving is now supposed to be £22,000 (!!!!), then you would lose a lot more than the £11,000 debt if you sell up.

Also, you point out that the CC debt keep increasing. Not to put to fine a point on it, you are spending more than you have coming in and you need to cut this as soon as possible. if you do not do that now, then selling up will not solve your problems.

Definately head over to the DFW board, look for southern scouser's stickie on the first page and put up your SOA. They will help you to reduce your expenditure and start tackling the CC debts.

Snow_Dog

Thats an awful quandry isn't it. Devil and deep blue sea.

Firstly, would renting be any cheaper than your mortgage? Most of the moving costs I think are incurred when you purchase, the biggest cost in our case was the stamp duty.

Are you on a fixed rate mortgage or tied in in any way? If not, go and see an IFA to find out if you could get a mortgage on a better rate, maybe a reduced rate for a year until you are able to work more hours when the kids are at school.

Selling up may long term be a better option if house prices drop, but then thats been predicted for the last 5 years and doesn't seem to have happened yet (though the barometer seems to be twitching).

macymoo

Thanks for all your advice, we ae going to weigh up the pros and cons and decide then. I will go over to the DFW board now, cheers

amcluesent

Have you looked at refinancing the mortgage to a longer term/interest only basis? Or take in a lodger - the first £4000 or so is tax free under the 'let a room' scheme.