Changing name on mortgage with negative equity

muchos_skintos

Hi,

I think this one is going to be a complicated one!

My wife left me in February so I am looking to remove her name from the mortgage provider. There is currently £125k outstanding on the mortgage for a property now worth £100-105k. We ex has agreed to walk away from the mortgage/property in exchange for taking ownership of the combined credit card debts which are in my name totaling ~£11.5k. These cards are from:
1. a balance from her card as she was struggling to repay
2. a "wedding credit card" (left me less than 6 months into marriage - cheers love!)

I am looking to draw up a legal contract for the credit cards but have hit a stumbling block in taking over the mortgage. The original mortgage was with.... Northern Rock! We have a 100% mortgage and this is now with NRAM. I have done an affordability review with them and they have told me they cannot agree to put it into my name only, even though I am sure I could cope with the repayments.

What are my options with the mortgage? They have asked me if I have considered re-mortgaging but the property is in negative equity. Could I really go elsewhere?

What if I were to keep her name with the provider but remove her name from the deeds, can I do this? I would take over the repayments even though the account was a joint and she would take over the credit card repayments even though those accounts are in my name (she has agreed that once she is in a position to get a loan/large credit card she will transfer to her ownership but not before mortgage is sorted).

Bit of a mess really, would appreciate some advice!

Cheers.

kingstreet

You do not appear to have any other options, other than to sell the property.

muchos_skintos

Selling would be bad. Would put me in £20k debt and her £10k, probably bankrupt us (literally). Could this sway the provider to put in my name?

TrickyDicky101

You could simply continue residing there and paying the mortgage (without remortgaging to your sole name). Please note that this carries complications for your ex as she will be unlikely to obtain a mortgage for another property whilst she still has this current one. Her credit rating will also be at risk if you were to default on the mortgage.

dimbo61

Northern Rock have not been selling 100% mortgages for what 5 years?
£11,500 of credit card debts on top and Negative Equity as well.
Not looking good and no way NRAM will let EX off the mortgage.
So you can not sell, Advert for lodger and overpay the mortgage or pay down CC debts over next 18/24 months.
Stop spending and shop at ALDI

Thrugelmir

muchos_skintos wrote: »

Selling would be bad. Would put me in £20k debt and her £10k, probably bankrupt us (literally). Could this sway the provider to put in my name?

No. Suggest you contact the National Debt Helpline. Has a website along with a freephone number. As bankruptcy may be your best option. If you are struggling with finances.

muchos_skintos

I'm not exactly struggling but I won't be able to pay mortgage AND credit cards but she is still paying half the mortgage and some of the credit.

Already rang debt advice, I am not in enough debt to go bankrupt or IVA etc.

My question remains, can I keep joint mortgage but not split anything of value should it be sold for profit one day?

muchos_skintos

One more thing, property only has one bedroom!

Thrugelmir

muchos_skintos wrote: »

My question remains, can I keep joint mortgage but not split anything of value should it be sold for profit one day?

You could always use that as a negotiating stance. Retain the property and the debt. With the provision that the ex has no future claim on the property. To be worthwhile you would need to start paying down the mortgage as well.

How would you cope if mortgage interest rates were to rise to 6% or 7%?

muchos_skintos

Interest rates played a part in them refusing me, they consider them rising by 2% and assess whether I could still afford it. It would be difficult but not impossible.

Foxy-Stoat_3

A potential of £20,000 shortfall on the mortgage plus fees and £10,000 credit card debt would be enough for Bankrupt or IVA.

Whats the likelihood of over paying the mortgage or property prices in your area rising to get you into positive equity by 5% in the next 5 years?